What to Expect from Real Estate in the Aftermath of the Election
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The dust has settled, and we finally have a new President of the United States. With the craziness of this election season, many people have asked me what we can expect from the housing market in the coming months and years, so I’m excited to tackle these topics and provide some clarity to you.
We have heard the question of “What happens next?” a lot over the last six months. Here’s the truth: elections can affect anything from mortgage rates to housing prices, stock market values, and corporate investments. However, studies show that during a typical election year, the uncertainty of a presidential race itself can have more of an impact on the housing market and economy than the actual outcome of the election. Statistics show that home prices rise 1.5% less during an election year than the year before an election and they rise 1% less in the year after the election.
The good news is that the U.S. housing market is stronger than it was during the 2012 election, as is the economy overall. Based on that, we should continue to see the market go up for the following year.
Here’s the challenge, though: because the election results can affect personal finances, some home buyers have been unwilling to take the plunge until the dust settles and the new president’s policies become known. I anticipate more buyers will jump back into the market in 2017 because it will be considered a window year where many adjustments will be taking place and policies won’t have an immediate impact on people’s lives.
Market fundamentals such as housing inventory, affordability, interest rates, job growth, and consumer confidence are real factors that influence the housing market. The fact still remains that housing accounts for 18% of the U.S. economy and remains one of the most foundational ways for Americans to build wealth.
I hope this has helped to clarify any misunderstandings you may have had about our real estate market in the aftermath of the election. If you have any follow-up questions or other questions you’d like me to answer, give me a call or send me an email. I look forward to hearing from you.