Why Home Sales Rebound After Presidential Elections

With the 2024 Presidential election around the corner, you may be wondering how the election cycle could impact the housing market. Here's what to know about the patterns in real estate during and after election years.

Election Years Typically Cause a Temporary Slowdown in Home Sales

Every fall, home sales naturally slow down as part of seasonal trends. However, in election years, the slowdown is often slightly more pronounced. Data from BTIG indicates that home sales tend to dip more noticeably in the month leading up to Election Day.

Why does this happen? The main reason is uncertainty. Many people, including potential homebuyers and sellers, choose to wait on major decisions until the election outcome is clear. This uncertainty around potential policy changes and economic shifts is particularly common in the housing market.

For instance, a recent survey by Redfin found that 23% of first-time homebuyers are delaying their purchases until after the election. This trend of waiting to see what happens has become a familiar pattern during election years.

Home Sales Usually Bounce Back After Elections

The good news for sellers and buyers alike is that this temporary dip in home sales doesn’t last long. History shows that home sales typically rebound in the year following a Presidential election. In fact, sales have increased 82% of the time in the year after an election.

This rebound occurs because, once the election is over, the uncertainty fades, giving buyers and sellers more confidence to move forward with their plans. As a result, we often see a surge in home sales once the election dust settles.

What to Expect for the 2025 Housing Market

If historical trends hold, we can expect a healthy rebound in home sales in 2025. Forecasts support this, with the housing market projected to increase from 4.6 million home sales in 2024 to 5.2 million sales in 2025. This aligns with the usual post-election bounce, where more buyers re-enter the market, leading to an uptick in transactions.

So, while the market may feel sluggish leading up to the election, this slowdown is likely temporary. Just as in previous election years, we can expect the market to pick up pace in the months after the election, providing more opportunities for both buyers and sellers.

Bottom Line

Election years often bring a brief pause in the housing market, but this slowdown is usually temporary. Historical data shows that home sales typically increase the year after a Presidential election, and 2025 looks to follow this trend. If you’re considering buying or selling, you can anticipate a stronger market once election-related uncertainty clears. The housing market is expected to regain momentum in the upcoming year, making it a good time to plan your next move.