Navigating Election Years: Real Estate Insights

As we approach another election year, the real estate market in West Michigan prepares for potential shifts and opportunities. At Treadstone Funding, we understand the importance of staying informed amidst the noise and uncertainties.

 

Stability Amidst Change

Contrary to popular belief, election years typically do not drastically alter the overall real estate transaction numbers in our region until the final quarter. Usually, home sales are unchanged compared to a non-election year, with the exception being November. In an election year, November is slower than normal. This is mostly because some people feel uncertain and hesitant about making big decisions during such a pivotal time. However, it’s crucial to note that these delays often lead to postponed, rather than lost, transactions. Additionally slowed demand in the 2 months prior to elections can spell opportunity for those who are not afraid to pull the trigger.

 

Mortgage Rate Expectations

One of the key concerns for prospective buyers during election years is mortgage rates. Interestingly, mortgage rates have historically trended lower from July to November in election years. As of the third week of January this year, rates have already shown a decline, with an expected further decrease of 0.5% to 1% by the end of the year. While political dynamics can influence market sentiments, our focus remains on providing stability and guidance amidst fluctuating conditions.

 

Market Performance Insights

Data shows that, on average, home prices have climbed 4.84 percent in election years since 1987, compared to a 4.44 percent increase in non-election years. This might suggest that presidential elections are beneficial for the housing market, but the reality is more nuanced. For example, the worst year for the housing market in recent decades was 2008, with home values plunging 12 percent. 2021 saw the best performance, with values soaring 18.9 percent amid record-low mortgage rates and the COVID-19 housing boom. General election years tend to experience a slowdown in the real estate market due to uncertainty, which can create opportunities for those ready to act decisively.

 

Post-Election Opportunities

Post-election periods often present opportunities for experienced investors and homebuyers. As the market settles and confidence returns, pent-up demand from delayed transactions can lead to increased activity in the real estate sector. This trend highlights the importance of staying proactive and informed amidst evolving political landscapes.

 

Join Us in Making Informed Decisions

As Mark Twain famously said, “History doesn’t repeat itself, but it often rhymes.” By understanding the typical patterns and trends in our local markets during election years, you can make informed decisions that align with your financial goals. Let us help you turn your homeownership aspirations into reality.

For more information on how election year dynamics may affect your real estate decisions or to explore mortgage options tailored to your needs, contact Treadstone Funding. Together, let’s navigate the opportunities and challenges of homeownership in the Midwest.

Source: Inman 2024

History shows the market stays steady through election years