Every presidential election sparks the same question: ‘Will the election affect the housing market?’ It’s a valid concern, particularly for those buying or selling homes in Arizona. Yet, despite the unpredictability of election years, data shows that the impact on the housing market is minimal.
While some buyers might claim they’re waiting for election results, they make up only a small portion of the market and have little influence on overall trends. The numbers back this up, showing that sales volume in Arizona before and after elections is often on par with, or even stronger than, non-election years—regardless of which political party wins.
Looking at the Numbers:
Here’s what past election years reveal:
- 2004 and 2020: Home sales surged in the months leading up to the election.
- 2012 and 2016: Sales were steady, reflecting typical non-election year patterns.
- 2000 and 2008: Sales slowed, but this was largely due to economic recessions, not the election itself.
Interestingly, the data shows no clear connection between election results and sales volume. The real drivers behind market fluctuations are economic conditions, interest rates, and life changes like marriage, divorce, and job relocations.
What Really Impacts the Housing Market?
The primary factors influencing the housing market are economic conditions, mortgage rates, and consumer confidence—not politics. While government policies, particularly taxation rules, may play a role in shaping market trends, the actual impact of a presidential election on the housing market tends to be minimal. Candidates may propose sweeping economic plans, but once filtered through Congress, the changes are often less dramatic than anticipated.
Even seasoned economists find it challenging to predict how the housing market will react after an election. Unforeseen global events—like a pandemic or economic crisis—are far more likely to cause significant market shifts than election outcomes.
What to Expect in Arizona’s Housing Market for 2024-2025
In recent months, housing supply has increased, though it remains lower than previous years. If demand stays steady or decreases as supply rises, prices could soften, potentially creating a more favorable market for buyers. However, this shift has yet to fully materialize, and prices remain strong across most areas of Phoenix.
Mortgage interest rates remain a key factor. Although the Federal Reserve recently lowered rates by 50 basis points, Arizona’s market didn’t experience a significant change. Many believe this is because rates had already adjusted in anticipation of the Fed’s decision. Buyers are still hesitant, as mortgage rates continue to hover in the 6% range, making it difficult to generate substantial interest.
Some homeowners are beginning to feel financial pressure from inflation, prompting them to list their homes for sale. In the coming months, we might see more distressed “fire sales” as sellers rush to move quickly. However, these situations are unlikely to involve short sales, thanks to the strong equity many homeowners have built.
Should You Worry About the Election?
The bottom line? While election outcomes are crucial for the country’s future, history shows that they have little impact on the housing market. You can move forward with confidence, knowing that Arizona’s real estate market is resilient and that your goals are achievable.
If you have questions about the current market—whether it’s about supply, interest rates, or how to manage financial challenges—reach out to Erica today. With expert guidance and local insight, you can make the best decision for your real estate future.
