Real Estate After A Presidential Election

The election is behind us and there is normal speculation as a new president takes office. I have been a real estate broker for six presidential elections and one thing is for sure as it relates to the impact on real estate: the fear of a new president is not worth the hype.

The first thing that happens is a slowdown leading up to the election. This year, 23% of buyers reported they were waiting until after the election to make a purchase, according to Redfin. The pause is acute in our area, which has a concentration of government employees and contractors.

It is interesting to see the trepidation among buyers because the data does not support a fear-based posture. I am going to present two key metrics for housing in the first year post presidential elections. The data supports an optimist outlook for 2025.

The first metric is how home sales performed in the year following a presidential election. Home sales went up nine of the last 11 elections. Sales dipped for President Ronald Reagan in 1981 and then dipped again in 1989 after President George Bush’s election. Considering the pullback in sales the last two years due to rising interest rates and a housing shortage, it is a safe bet to predict sales will increase in 2025.

My prediction: Sales will increase in 2025 in Anne Arundel County.

The next metric, which is an obvious concern for homeowners, would be the value of their home. In the year following an election, values rose seven of the last eight elections. The only year values dipped was in 2009 after President Barack Obama’s victory, which was amidst a real estate collapse. Such an acute situation does not exist currently, which supports a belief that values will rise in 2025.

My prediction: Sales prices will rise in 2025 in Anne Arundel County.

Furthermore, four leading financial institutions and the National Association of Realtors released predictions on October 11 for values in 2025:

Goldman Sachs: 4.4%

Wells Fargo: 4.3%

Fannie Mae: 3%

Morgan Stanley: 3%

National Association of Realtors: 1.8%

The wild card in this analysis will be the residential mortgage rates. The stagnation of sellers due to clutching onto their low interest rates continues to cause scarcity of new listings. Buyers remain ready, willing and able on the sidelines. My prediction is if rates make it to 6% or less then buckle up because sales will hit new records.

My overall prediction for local real estate in 2025 is extraordinarily positive.