Presidential Election Years & Our Local Real Estate Market

Does a presidential election affect the real estate market?

There are traditional seasons in real estate. Usually spring and summer are opportune times to sell because homes show beautifully in the spring and it’s an easy time to move for families with school aged children. Things slow down in the dog days of August and tend to pick up again with the pretty fall weather and a new fiscal year for some. Occasionally you’ll find people wanting to buy before the end of the calendar year so they can declare a homestead exemption the following year. A little quiet time during the holidays and we start all over again. Each year, this traditional calendar varies depending on market demand, but you can kind of expect this rhythm.

Another seasonal affect we traditionally see is a slow down in the luxury market during election years. Most people still have to relocate for work, or move because they need more space. Those things happen whether it’s an election year or not. You still need a place to live. However, some people may pause until after the election if they are concerned about how the new administration or the incumbent’s return affects taxes, residency for foreign buyers, or their business interests. That pause is usually brief. I think it’s more distraction than concern, and things usually pick back up in December.

I was curious to know if this is really that big a deal so I looked at sales of single family homes in area 16, which is the area I focus on in the Inner Loop. I looked at sales for the past 4 years, including the 2016 and 2012 elections – just to see how those 2 election years compared. (see table below)

Interestingly, 2012 had the highest number of home sales overall with the lowest average home sales price. That lowest average sales price probably has nothing to do with the election since home prices have been inching up each year.

But what about those homes priced over $1,000,000? When you look at total homes sold that were priced over $1,000,000.00, 2012 had the least but those numbers increased year over year, dipping a bit in 2019. So just from this small sampling it looks like Houston’s Inner Loop has seen more homes sell in the past 2 election years, but not necessarily a dip in the sale of homes over $1,000,000. When it comes to the Houston housing market, the local economy has more of an effect than the national election. It will be interesting to see how the numbers for 2020 look. I’ll share those in January when they come out.

Until then, get out and vote and know that this is as good a time as any to buy or sell a home.