How will the election affect real estate sales?

Whether you are a current homeowner or thinking about buying or selling in the next year, this is “the question” on all of our minds.

Fortunately, the experts at Keeping Current Matters have already unpacked this for us.

According to the experts, typically in non-election years, home sales drop 9.8% nationally in November compared to October due to season sales cycles. In a presidential election year that number dips to 15%.

The reason for this extra dip is simple: buyers can become temporarily nervous about election uncertainty. They key takeaway here is that the deferral of buyer purchases is 𝙩𝙚𝙢𝙥𝙤𝙧𝙖𝙧𝙮. It’s simply a pause in the market until the election passes.

According to chief economist Ali Wolf:

“History suggests that the slowdown is largely concentrated in the month of November. In fact, the year after a presidential election is the best of the four-year cycle. This suggests that demand for new housing is not lost because of election uncertainty, rather it gets pushed out to the following year.”

Now again, we want to stress we are talking about what happens in normal election years. We all know 2020 has been anything but normal. With continued low inventory + low interest rates here in Central Iowa our prediction is we are going to see our market continue with little to no dip in homes sales, specifically related to the election.

This may seem like a bold prediction, so hear us out. Despite everything that has gone on this year, we have seen home sales increase above and beyond 2019 sales, even though we have significantly lower inventory. 

What’s driving this?

Interest rates. We are seeing some of the lowest interest rates EVER. Buyers want to take advantage of the resulting home affordability and this is what is driving our prediction. Our local market is very competitive and we don’t see that changing anytime soon.

If you have any questions about this and how your particular home sale or buying experience might be affected by the happenings of this year, contact us anytime. We would love to consult with you and show you how to navigate the crazy world of real estate in 2020.