The Election and the Market – Another question answered! This one is about real estate and the election.
Will the upcoming election impact the housing market?
Yes – but the decrease in sales will only last from just before the election until the start of the next Spring market.
BTIG, a research and analysis company, looked at new home sales from 1963 through 2019. (source: One House, Two House, Red House, Blue House)
It was noted that in non-presidential years, there is a -9.8% decrease in November compared to October. This is the normal seasonality of the market, with a slowdown in activity that’s usually seen in fall and winter.
However, it also revealed that in presidential election years, the typical drop increases to -15%.
The report explains why: “potential homebuyers may become more cautious in the face of national election uncertainty.” As such, the real estate market is a little slower during the time just before and immediately after a presidential election. However, the year following a presidential election year is often the best in the four year cycle.
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