Hold Off On Buying Until After the Election, Or Not…?

Every election cycle, the same topic often comes up: everyone is saying that it is best to wait until after the election to buy a house. I have been in the business for almost 25 years, and I see this conversation come up every time.

Let’s Look at Historical Data

So, I decided to dive in to see if it’s actually good advice to wait. I went way back and looked at the historical data: how are mortgage rates and median home prices affected? I looked at the data before, during, and a full year after the election.

It turns out that I could find NO correlation. I looked at the trends leading up to a democrat getting elected or a republican getting elected. I tried to look at the situation any way I possibly could. I counld’t find any meaningful correlation anywhere.

Yes, it makes sense that people would think it’s better to wait until after the election. But there are a handful of problems with this thinking. For one: do you know the outcome of the election? No one does!

For those of us in the real estate and mortgage business, we aren’t here to convince you to buy a home. The reality is that people are going to buy when the timing is right for them individually.

No One Can Predict the Future

My perspective is that we have no idea what will happen in the future. Waiting to buy until after the election is over is like waiting to see if an earthquake is coming. We just don’t know what the outcome is going to be.

Since there is no data to back this idea, it’s just another myth out there that needs to be changed.

To be fair: there have been times when a new president had an effect. For example, in 2016 and 2020 we actually saw rates go up after the elections. About a year after Trump was elected in 2016, rates were up by about a half point.

Side Note & Other Factors to Consider

But there are so many other factors that can affect housing prices, the economy, and interest rates. We can’t necessarily pin the changes in the real estate market on the election. So, there’s no reason to wait to buy a home just because an election is coming up.

Also, on another side note: even if we do see changes, such as interest rates coming down, there will be other responses in the market. For example, a drop in interest rates will pull more buyers into the market, which is going to drive up prices.

The truth is that there are a lot of factors that affect the real estate market. Don’t be fooled into thinking that you can time the market, because we never know what is going to happen in the future. If you ever feel like you timed the market in the past, then it was really just luck since we can’t predict how things will change down the road.