In recent months, real estate agents across the country have heard a familiar refrain from prospective homebuyers hesitant to pull the trigger: I’m waiting for the election.
Logically, it probably makes little short-term difference to the individual homebuyer whether Kamala Harris or Donald Trump is elected president. Home prices and mortgage rates are unlikely to change dramatically when the sun rises on Wednesday, no matter the outcome.
But in a closely contested, highly polarized election where both candidates have put forward diverging housing policy proposals, some homebuyers might be seeking more certainty before making one of the biggest financial transactions of their lifetime.
Nationally, sales of existing homes dropped to a 14-year low in September, despite mortgage rates touching a two-year low that month, according to the National Association of Realtors®.
“Homebuying is clearly a major decision, and we know the country is in a polarized state,” NAR Chief Economist Lawrence Yun said last month. “Maybe people are just waiting to see what the result of the election will be before making a major decision, like homebuying or home-selling decisions.”
Trump supporters might be holding out hope that he can somehow fulfill his promise to lower mortgage rates, which aren’t typically under the president’s control. First-time buyers might hope Harris wins and delivers the $25,000 down payment subsidy she campaigned on, which would require congressional support.
Cayden Harry, an agent with Family Tree Realty in Yucaipa, CA, has noticed election chatter at open houses in recent months, with many prospective buyers in the Republican-leaning area claiming they want to see Trump win before signing a contract.
“They think that if Trump wins, he’s going to lower interest rates and home prices are going to go down,” he says, adding that he is skeptical of that prospect. “They think that if Trump wins, the price of McDonald’s is going to go down.”
Harry was surprised after listing a home in Beaumont, CA, in late September, and waiting 24 days before getting a single call or request for a showing.
The five-bedroom home was listed for $680,000, which he believed was competitive after an identical model in the development was quickly sold for $695,000 in August. But as the weeks ticked by with no offers, he began to wonder if election jitters were to blame.
(Realtor.com)
In bright blue Manhattan, buyers have also expressed election nerves in recent months, says Michelle Griffith, an agent specializing in high-end listings with Douglas Elliman.
“Any type of uncertainty, most buyers pause their search and have this sort of ‘wait and see’ type of mentality,” says Griffith. “But then you have your seasoned buyers who realize uncertainty creates opportunity in the market.”
Will there be a post-election home sales bump?
Historically, there’s little evidence that home sales or prices drop in the run-up to presidential elections, according to an analysis of NAR sales data by the Realtor.com economics team.
Over the past five elections (2004–20), a year-over-year slowdown in home sales occurred in the four months prior to just two elections: 2004 and 2016. Slowing price growth was observed before only two of the elections, in 2004 and 2008.
However, there is more evidence for a post-election bump. Home sales and prices have increased annually in the four months following each election since 2004, with the exception of 2008, when the Great Recession threw the housing market into crisis.
Those gains have also been bigger than the period immediately before the election in all election years except 2008. In some cases, like 2012, the improvement was fairly marginal, but in years like 2016 and 2020, the rebound was much sharper.
On average, home sales jumped 7% annually in the four months following the past five presidential elections, while prices rose an average of 5%.
Still, economists say that factors such as mortgage rates and the strength of the economy are the main factors driving homebuyer behavior, with fears over election outcomes likely playing a much smaller role.
“The idea that pre-election uncertainty stops many homebuyers and sellers from moving forward is one that we hear anecdotally from agents and others in the real estate industry,” says Realtor.com Chief Economist Danielle Hale.
“While it is undoubtedly true that some buyers and sellers will point to the election when asked why they are not moving, historical data put a question mark on the extent to which this effect slows home sales and prices in the period immediately before the election,” she adds. “The data is far more supportive of a pickup in sales and price growth after the election.”
Election jitters ‘a smoke screen’
Homebuyers who claim to be waiting for the election to make a decision are often just giving a “smoke screen” response, and may have other reasons not to buy, says David Zarghami, CEO and co-founder of Zarghami Group, a Keller Williams real estate firm in Sarasota, FL.
Zarghami’s firm recently had a prospective buyer looking at a very expensive property in Siesta Key, who claimed that if his favored candidate won, he would buy it, and if the other candidate won, he would build a bunker in Iowa instead.
“I just had a hard time really wrapping my head around the idea that a person of that level of supposed success in business would pin their fortunes on something so far out of their control,” he says.
“But it’s a volatile time,” he adds. “There’s a lot of anxiety in the world, so if someone was on the fence for another reason, maybe they get in their head, and that’s an excuse for them to sit tight and just wait.”
Andrew Fortune, who runs the real estate brokerage Great Colorado Homes in Colorado Springs, says that two of his agents have had buyers who want to wait until after the election to look at more homes.
“One buyer is younger and believes that if Trump wins, home prices will drop next year. The other buyer is older and believes that if Harris wins, the housing market will crash, so they want to wait,” he says.
Still, Fortune says that the majority of his clients aren’t worried about the election outcome.
“Just as with the last elections, nothing changes right away in real estate,” he says. “Economies go up and down based on the decisions made over the last few years. Markets don’t change that fast.”
Julie Taylor contributed to this report.
