Presidential Elections Don’t Hurt Home Sales
Every four years, both we and our clients are flooded with stories of prospective homebuyers who say they’re delaying their purchase decisions until after the upcoming election. Political uncertainty and negative campaigning clearly affect consumer confidence, as research from the University of Chicago has shown. But do these prospective buyers actually impact overall home sales?
According to John Burns,
We have found that this type of buyer is the exception rather than the rule. To assess the impact of presidential elections on home sales, we compared the non-seasonally adjusted, year-over-year change in new and existing home sales in the 5-month period* leading up to November (the month an election is held during an election year). We found the following:
In non-election years, new home sales decline by -14% on average, and existing home sales decline by -22% on average. In election years, new home sales decline by -10% on average, and existing home sales decline by -19% on average.
- 3 elections where home sales fell less than seasonally expected: 1992, 2004, and 2020
- 3 elections where home sales fell in line with seasonal expectations: Home sales appeared normal in 1996, 2012, and 2016.
- 2 elections where home sales fell more than seasonally expected: The leadup to the elections of 2000 (Bush vs. Gore) and 2008 (Obama vs. McCain) both coincided with recessions, which caused home sales to decline more drastically than normal.