Historically, the housing market has shown to fall during an election year, but this year the housing market is on track to stay strong. Election years can bring on stress and put Americans in an uneasy state, but there are a few factors that could be shifting the correlation of this presidential election year and the real estate market. Here are three housing market trends to keep an eye on during 2016 that are making this election year have less of an effect on the housing economy than it has in the past.
1. A Seller’s Market can Increase Competition
While there might be a shortage of homes for sale in some local markets, this doesn’t necessarily make the market stagnant. If anything, this increases competition and isn’t something that an election year would necessarily deter. There is a new surge in demand for homes on top of a long-term inventory shortage, which shifts the dynamic in the real estate market. With the prior economic freeze, many individuals have been delaying marriage, living with their parents, or taking on roommates. With the new economic turnaround, employment rates are up and new families are now on the market for new homes, even during the 2016 election year.
2. The Benefits of Technology-Based Real Estate Tools
Searching for, viewing, and closing on properties is a rapid-paced process these days. Individuals who are in the market to buy homes can make rather quick decisions and might not be focusing on politics or market shifts. When it comes to buying a house, the process from beginning to end has been streamlined with online resources, smartphone apps, and multiple ways to be in constant communication with real estate agents. This fast-paced process is a structural change in what used to be a slower moving real estate market. Technology frees buyers, especially in a seller’s market, from other factors in the world such as the political economy that can stall decisions.
3. Factoring in a Robust Economy
With so much up in the air pending the 2016 election, it might make people freeze up and not want to make any big purchases. Real estate investments have historically been put on the back burner until a new president takes office. The thing is, consumer confidence is at an all time high. With low unemployment rates, individuals have more incentive to buy. Home prices are still increasing, but not at a rapid rate. Excellent financing and low-interest mortgage rates are keeping the housing market steady and can drive the market just as much as competitive selling.
Factors stemming from the economy, low interest rates, and changes in technology all have a hand in increased consumer confidence. This election year, people seem less concerned about the political climate around them, and more concerned with moving ahead in their own personal choices. This new trend seems to be coming from the market itself and is giving individuals more power and less apprehension from the political economy around them.
Please contact me if you would like to know why now would be a strategic time to buy or sell your home. (949) 375-9981