From the news, daily texts and emails from politicians and every corner of the internet, the upcoming election is seemingly touching every aspect of our lives - including real estate. We are often asked what impact, if any, the presidential election has on the real estate market. 

Temporary Real Estate Slowdown During Election Years

In a typical fall market, homes sales start slowing down gradually in October and November, and it is fairly quiet Thanksgiving through the start of the new year. (Although there isn't much on the market during this time, we do work to start preparing for the spring market, which starts as early as mid-January.) That said, according to analysis from BTIG, there’s typically a slightly larger dip in presidential election years than we see during our normal fall slowdown, leading up to election day. But, why? 

Simply put: uncertainty. Some consumers will wait to make life major decisions or purchases until they see how the election pans out. According to the chart from BTIG’s data (via Keeping Current Matters), home sales nationally between 1963 - 2019 have slowed down on about 5.2% from October to November of election years. Additionally, a survey from Redfin recently revealed that 23% of potential first time home buyers are awaiting the election results before they purchase a home. 

Bouncing Back After the Election

History has shown that home sales bounce back after elections are over - in fact, they typically increase the year after the election. This is attributed to the fact that there is more clarity and a sense of confidence in what lies ahead, which in turn results in an increase in home sales.  

What’s in Store for 2025? 

If history is any indicator, home sales will typically increase the year after a Presidential election, and current forecasts indicate 2025 will be no different. On top of more certainty with the presidential election in the rear view mirror, interest rates are expected to decrease which usually spurs more real estate activity. According to its October forecast, the government-sponsored enterprise (GSE) Fannie Mae predicts 30-year mortgage rates will be at 6% by the end of 2024 and 5.6% by Q4 2025. Although we don't have a crystal ball to predict the future, all signs point to the market gaining speed starting in January 2025, no matter what happens on November 5th.