How Presidential Elections Impact the U.S. Housing Market and Why It Could Be The Perfect Time To Buy or Sell

Oct 30

3 min read

Election years often create uncertainty, but savvy buyers and sellers know that these periods can present unique opportunities in the housing market. Over the last 30 years, U.S. presidential elections have had significant impacts on real estate. Whether you’re looking to buy or sell, election years can offer strategic advantages. Here’s why now might be the perfect time to make your move.

1. Market Slowdowns Create Buying Opportunities

During election years, buyers tend to hold back, waiting to see how the political landscape will shift. This temporary dip in demand can reduce competition, giving buyers more leverage in negotiations. In past election years, such as 2008 and 2016, uncertainty led to market slowdowns, making it easier to find favorable deals. If you’re in a position to purchase, you can take advantage of this brief lull in activity.

2. Potential Changes in Interest Rates

While the Federal Reserve operates independently, interest rate trends are closely tied to economic policies introduced by new administrations. In some election years, rates remain low as the economy stabilizes in anticipation of new leadership. For example, in 2020, mortgage rates hit historic lows, fueling a housing boom despite the uncertainty of the election. Buyers who lock in favorable rates during these periods can save thousands over the life of their mortgage.

3. Tax Policy Uncertainty Encourages Sellers

Election outcomes can bring changes in tax policy, particularly surrounding capital gains and mortgage deductions. Sellers may feel motivated to act before potential policy shifts take effect. For example, during the 2016 election, there was concern that a new administration might adjust tax laws, spurring some homeowners to sell before the end of the year. If you’re thinking of selling, listing your home during an election year could help you close before any unfavorable tax changes occur.

4. Increased Buyer Motivation Post-Election

Buyers who hold off during the campaign season often flood the market after the election concludes, driving up competition and prices. If you’re a seller, positioning your property for sale during or immediately following an election year can maximize exposure and buyer interest. Historically, housing markets tend to pick up quickly after elections, especially when economic policies favor growth and consumer confidence.

5. Shift in Housing Policy and Incentives

New administrations often introduce policies targeting homeownership, affordable housing, or market deregulation. For example, the Clinton administration expanded low-income homeownership programs, while the Obama administration focused on stabilizing the market after the 2008 financial crisis. If you’re in the market to buy or sell, staying ahead of these policy shifts allows you to capitalize on new incentives or avoid potential market changes.

6. A Strategic Window for Investors

Election years provide a prime opportunity for real estate investors. With consumer behavior fluctuating, investors can find deals in cooling markets or position properties to sell at a premium once the election cycle concludes. Additionally, new government policies often bring opportunities for tax benefits, subsidies, or favorable lending conditions that investors can leverage.

While some buyers and sellers hesitate during election years, those who act strategically can benefit from market conditions. Whether it’s reduced competition for buyers, favorable tax positioning for sellers, or the potential for favorable interest rates, election years present unique opportunities. If you have the ability to make a move, taking advantage of the market during an election year can put you ahead of the crowd and position you for success before new policies and market dynamics take shape.