5 Housing Market Predictions: 2024 Presidential Election Effect on Real Estate

If you’re anything like me, you’re probably keeping a close eye on what’s happening in the housing market. With the 2024 presidential election just around the corner, a lot of people are asking, How will the 2024 presidential election affect real estate? Whether you’re looking to buy your first home, sell, or invest, understanding the election’s impact on the housing market in 2024 is crucial.

In this article, I’ll explain the effects of the upcoming election on real estate. We’ll tackle everything from election and housing market dynamics to whether housing prices will drop in 2024.  Ready?

The Current State of the Housing Market

Let's kick things off with a reality check. Our housing market? It's in a bit of a pickle. We're short a whopping 42 million homes! Can you believe that?

The housing market has had quite a rollercoaster ride over the past few years. With interest rates fluctuating and inventory challenges, homebuyers have faced a tough environment. According to recent reports, the national average mortgage rate sits above 7%—yikes! That’s up from the 3% we saw just a couple of years ago.

It's basic supply and demand, folks. You know, the same principle that makes those limited-edition Nikes or Super Bowl tickets so darn expensive. But when it comes to housing, people seem to forget this simple concept.

"No, prices can't go up forever," they say.

Well, hate to break it to you, but prices can keep climbing if we don't fix this supply problem. And let me tell you, for prices to crash, you need a bunch of houses for sale. No houses? No crash. It's that simple.

This spike in interest rates has put pressure on buyers. It means higher monthly payments, which can push many people out of the market altogether. Now, you might be wondering, will the housing market crash? Experts have varying opinions, but we’ll explore that in a bit.

How Will the 2024 Presidential Election Affect Real Estate?

Now, let's talk about the elephant in the room – the 2024 presidential election. We've got two major contenders: Kamala Harris and Donald Trump. Both have some pretty wild ideas about how to tackle this housing crisis. Let's break it down, shall we?

Kamala Harris’ $25,000 Question

Harris is coming in hot with a $25,000 down payment assistance for first-time homebuyers. Sounds great, right? Well, not so fast. Here's the thing: if we don't fix the supply issue first, this could be like throwing gasoline on a fire. More money chasing the same number of houses? You guessed it – prices go up even more.

She's also talking about building 3 million new homes over 4 years. Ambitious? You bet. Realistic? Well, that's where things get tricky. We're currently building about 1.1 million houses a year, not the 1.6 million we actually need. So, Harris better have a magic wand up her sleeve if she's going to keep that campaign promise.

Donald Trump’s “Just Build”

Trump's plan? It's all about cutting red tape and opening up federal land for construction. Sounds logical, right? More land equals more houses equals lower prices. But here's the catch – most of that federal land is out west, often in areas prone to wildfires or with limited water supply. Not exactly prime real estate, if you catch my drift.

Plus, Trump wants to crack down on illegal immigration. Now, we’re not debating politics here but here's a reality check: the U.S. construction industry is facing a major labor shortage. Fewer workers could mean fewer homes built and – you guessed it – higher prices.

The Housing Market 2024: What's Really at Stake?

So, what does all this mean for you and the housing market in 2024?

Regardless of who wins, we need more houses. Period. Will housing prices drop in 2024? It's possible, but don't hold your breath. As long as we're short on supply, prices are likely to keep climbing.

Now, I know what you're thinking. "Matt, are you saying the housing market predictions for 2024 are all doom and gloom?" Not at all! In fact, this could be a golden opportunity for savvy investors.

Predictions for the Housing Market in 2024

With all this in mind, let’s take a look at some housing market predictions for 2024 and what you might expect.

• Interest Rate Sensitivity: High interest rates in 2024 are likely to cool down the market, making buyers hesitant. This will likely lead to a decrease in transactions compared to 2023, but any major shifts will depend on the Fed's decisions.

• Housing Prices Staying High: Despite a slowdown in sales, home prices are expected to remain elevated due to ongoing supply constraints, even if demand weakens slightly due to economic uncertainty and higher borrowing costs.

• Slight Price Drops Possible in Certain Areas: In some regions, particularly those that saw rapid price increases in the past few years, modest price declines could happen, though a significant crash is not anticipated.

• Impact of Political Uncertainty: Uncertainty surrounding the 2024 Presidential Election may cause hesitation in both the buying and selling markets. This uncertainty typically leads to a temporary slowdown, with many participants waiting until after the election to make major decisions.

• Investment Market Impact: Real estate investors may adopt a "wait-and-see" attitude, with many pausing major investments until after the election results are clear, particularly if there is concern over policy shifts that could affect taxes, regulations, or incentives for real estate investment.

What Can You Do to Prepare?

Now that we’ve covered the predictions and possible outcomes, you’re probably wondering what you can do to deal with these changes. Here are a few tips:

1. Stay Informed: Keep an eye on the news and the latest updates regarding the election and economic factors. Understanding how policies and rates change can help you make informed decisions.

2. Know Your Market: Local markets can behave differently than national trends. If you’re considering buying or selling, research your specific area to understand how these broader trends are playing out on the ground.

   For instance, you can explore Go Off Market which has thousands of properties listed and a straightforward closing system. it’s a fantastic resource for finding your next investment opportunity. 

3. Get Pre-Approved: If you’re planning to buy, getting pre-approved for a mortgage can give you a competitive edge in a fluctuating market. It shows sellers you’re serious and ready to make an offer.

4. Consider Rentals: If buying feels out of reach, consider investing in rental properties. With rental demand likely increasing, this could be a great way to enter the real estate market without the burden of homeownership.

5. Connect with Experts: Partnering with someone who knows the ropes can help you navigate the complexities of the housing market. From real estate agents to trusted financial advisors, getting the right guidance makes all the difference.

Focus on What You Can Control – Your Financial Strategy

As we gear up for the 2024 presidential election, the effects on the housing market will be fascinating to watch. With potential shifts in demand, price stabilization, and the ongoing challenge of affordability, it’s clear that the election and housing market are intertwined.

But with the right strategies and support, you can turn these challenges into opportunities. You know, some of my best real estate insights have come on the golf course. There's something about the fresh air and the challenge of the game that really gets the creative juices flowing. It's a chance to hit the links, pick the brains of successful investors, and maybe even close a deal or two. 

So, what do you say? Are you ready to take charge of your financial future, regardless of what the housing market predictions say? Let's do this together!