By Realtor Shane Bean, at FirstWalk Realty to begin your journey with confidence. You can send me a direct message or give me a call at 832-422-7474, or click this link to learn more about me and my team.
These rate changes have impacted mortgage rates as well. Under Trump, 30-year fixed mortgage rates fell from approximately 4.09% in January 2017 to about 2.77% by January 2021. Under Biden, these rates have increased significantly, rising to about 7.09% by mid-2023, largely due to the Fed’s rate hikes to combat inflation
(FactCheck.org)
(The Dispatch)
.
How the US Presidential Election Could Impact Real Estate
The US presidential election is a significant event that has far-reaching implications across various sectors, including real estate. Whether you are a homeowner, a real estate investor, or someone planning to enter the market, understanding how the election can influence real estate can help you make informed decisions. The Biden and Harris administrations, with their similar strategies and points of view, have both focused on key economic measures that, while aimed at economic recovery, have had various ripple effects, including on real estate markets.
Economic Policies and Real Estate
The economic policies proposed by presidential candidates often have direct impacts on the real estate market. For instance, policies related to taxation, interest rates, and federal spending can influence property values and investment opportunities.
Interest Rates: Trump vs. Biden
Interest rates are a critical factor in the real estate market, affecting mortgage affordability and investment returns. Let’s look at the interest rate trends during the Trump and Biden administrations.
- Trump Administration (2017-2021):
- In 2017, the Federal Reserve increased interest rates three times, with the rate reaching 1.25% by the end of the year.
- Rates continued to rise in 2018, peaking at 2.50%.
- In 2019, the Fed cut rates three times, ending the year at 1.75%.
- In 2020, due to the COVID-19 pandemic, the Fed slashed rates to nearly zero, ending the year at 0.25%.
- Biden Administration (2021-Present):
- The Federal Reserve maintained low rates in 2021 to support economic recovery, with rates staying close to 0%.
- In 2022, to combat rising inflation, the Fed began increasing rates, ending the year at approximately 4.5%.
- In 2023, rates continued to be adjusted in response to economic conditions, reflecting ongoing efforts to balance inflation and economic growth.
These rate changes have impacted mortgage rates as well. Under Trump, 30-year fixed mortgage rates fell from approximately 4.09% in January 2017 to about 2.77% by January 2021. Under Biden, these rates have increased significantly, rising to about 7.09% by mid-2023, largely due to the Fed’s rate hikes to combat inflation
(FactCheck.org)
(The Dispatch)
.
Housing Market Regulations
Candidates’ positions on housing market regulations can also play a crucial role. These regulations might include:
- Zoning Laws: Changes in zoning laws can impact the development of new housing projects, affecting the supply and demand balance.
- Affordable Housing Initiatives: Proposals to increase affordable housing can lead to more housing options for low and middle-income families, potentially affecting rental markets and home prices in various regions.
Consumer Confidence
The election can significantly influence consumer confidence. Uncertainty or optimism about the future can affect people’s willingness to buy or sell homes.
- Market Stability: Elections often bring a period of uncertainty, which can lead to a temporary slowdown in the real estate market as buyers and sellers adopt a wait-and-see approach.
- Long-Term Confidence: The outcome of the election can either boost or dampen long-term confidence in the economy, influencing decisions to invest in real estate.
Infrastructure and Development Plans
Presidential candidates often have different visions for national infrastructure and development. Investments in infrastructure, such as transportation and urban development projects, can enhance property values and spur new real estate opportunities.
- Urban Development: Proposals to develop urban areas can lead to increased property values in those regions.
- Rural and Suburban Growth: Plans to invest in rural and suburban areas can lead to growth and new real estate developments outside major cities.
Environmental Policies
Environmental policies proposed during the election can affect real estate, particularly in regions prone to natural disasters or those undergoing significant environmental changes.
- Climate Change Policies: Initiatives to combat climate change can lead to stricter building codes and increased costs for property development, but they can also make properties more resilient and sustainable in the long term.
- Disaster Management: Policies aimed at improving disaster management and resilience can protect property values in vulnerable areas.
Conclusion
The US presidential election has a multifaceted impact on the real estate market. From economic policies and housing regulations to consumer confidence and infrastructure development, the decisions made by the future president will shape the real estate landscape in various ways. For buyers, sellers, and investors, staying informed about the candidates’ positions and proposed policies is crucial for navigating the market effectively.It’s important to recognize that during Trump’s administration, mortgage rates dropped significantly, and his numbers reflect a positive impact on both the economy and real estate markets, while the Harris-Biden approach has yet to show similar beneficial outcomes in these areas.As always, it’s wise to consult with real estate professionals to understand how specific policies might affect your local market and to make the most informed decisions possible.If you’re looking to buy or sell a home in the North Houston areas like The Woodlands, Conroe, Magnolia, Montgomery, Willis, Spring, or Tomball, contact me, Shane Bean, at FirstWalk Realty to begin your journey with confidence. You can send me a direct message or give me a call at 832-422-7474, or click this link to learn more about me and my team.
