The 2016 Presidential Election has been anything but normal and regardless of who is elected into office, people are wondering what will happen to the housing market. We wanted to spend some time looking to the past in order to have a better understanding of housing trends during election years.
Uncertainty = Conservative Behavior
When people are uncertain, they often wait to make any major life decisions or changes. This could be anything from making a career change to finding the right home to start a family. It is human nature to be gun shy in the face of uncertainty. Looking back to the 2012 (last election) numbers for the MN, check this out:
- The year (2011) before an election home average prices dropped by 9%
- During the election year (2012) home average prices rose 9%
- After the election year (2013) home average prices rose by 12%
How about the prior election in 2008:
- The year (2007) before an election home average prices dropped by 2%
- During the election year (2008) home average prices dropped 15%
- After the election year (2009) home average prices dropped by 16%
Looking at these numbers brought an instant shutter thinking about those years in Real Estate, that was not pretty and may not be the best example to review as it was a market that had many external factors that changed the course of market history.
Uncertainty in policy, economy and interest rates can create consumer unrest and a wait and see mentality. As we continue to watch the numbers in the housing market and trends, it is interesting to see how quickly our market has rebounded from the economic downturn and how we are quickly approaching another historic market for the cost of homes.
Feel free to comment and share any concerns or opinions you have with what the upcoming election with regards to its impact on the real estate market.