How the Midterm Election Results Could Impact Housing (and Your Home) in 2023

As the dust settles from the 2022 midterm elections, home sellers, buyers, owners, and renters are on the alert. Leaders have shifted seats, the power to draw new housing legislation has changed hands, and voters have cast their ballots on new housing measures.

You’re probably wondering, “How will the midterm elections impact my housing situation?” It’s why we tapped into insights from expert housing economists and real estate professionals, including:

Alex Thomas, senior research analyst at John Burns Real Estate Consulting,
Dr. Stanley D. Longhofer, professor and Stephen L. Clark Chair of Real Estate and Finance Director for Wichita State University Center for Real Estate,
Jerome Leyba, a Santa Fe real estate agent who sells homes more than 32% faster than the average agent in the area, and
Stephanie Nash, a top-selling Texas real estate agent who works with 71% more single-family homes than the average Killeen agent.

In this article, we lean on expert opinions and dive into what the midterms could mean for your housing situation. Here’s an in-depth look at how the midterm elections could affect home buyers, sellers, renters, and owners now and in the years to come.

How the midterm elections could influence real estate, nationwide

Although a few races are still up in the air, the national midterm election picture is crystallizing. No matter how state runoffs conclude, one political theme is emerging: power will be divided.

We know Republicans will control the House in 2023 — and will likely stand at odds against many of the Democratically-led executive branch’s proposals. At the same time, the Senate’s final makeup will come down to a Georgia runoff. But because they control a Senate tie-breaker vote in the Senate, Democrats will hold a razor-thin margin in that chamber regardless of the Georgia outcome.

So, what does the new balance of power on the national scene mean for housing? Here are a few ways the new political landscape could impact your housing situation:

New national housing policies could sputter

The 2022 midterm elections have split an already divided government even further. And that could mean any major national housing policies that were forming prior to the election will dissolve, or at least run into snags.

One of the housing policies that’s received some of the most attention recently is the First-Time Homebuyer Act. First proposed in 2021, this piece of legislation would have shifted the tax code to give first-time homebuyers up to $15,000 in federal tax credits. However, the policy still requires approval from lawmakers, and it’s unlikely to be passed under a divided congress.

Thomas says home sellers, buyers, and owners should expect a similar pattern of sluggish dealmaking with other housing legislation in the near future.

“In a divided Congress, it’s going to be harder to get priorities that Democrats want to get through, through,” says Thomas. “Anything they want to do will need to be bipartisan. That’s going to limit the speed and the size of what they can do.”

Still, if you’re worried the new political landscape will change your home buying or selling plans, Thomas says not to fret too much. He explains that national politicians tend to have limited influence over housing markets.

“In terms of the real estate market and housing, I think the impact of the federal government is relatively limited,” he says. “A lot of housing legislation gets passed at the state level and the local level.”

Housing prices may settle on more solid ground

Since the last midterm election cycle in 2018, housing prices have taken a wild ride. The median home price in November of 2018 sat at $253,382, according to DQYDJ historical housing data. That price climbed $135,201 higher by January of 2022. Since then, prices for the median home have dipped by around 1.7% nationwide – with prices in some areas dropping by as much as 10% since June.

Now, Leyba says splitting government power could calm down a housing market that’s moved frantically in recent years.

“The midterm elections could create more stability on pricing, so we should see the market even out,” says Leyba. “If we do, for homeowners that planned to sell high, increasing prices may not be [an option].”

If prices find stable footing, it could end up emboldening new homebuyers who have felt intimidated by volatile prices. However, for sellers, it may also mean you’ll need to readjust your pricing expectations in some housing markets.

To get a ballpark estimate of what your home might be worth now, try HomeLight’s Home Value Estimator. Our online tool uses information from multiple sources to provide a real-time preliminary home value estimate based on current market trends.

No, the midterms will not impact home sales prices. The inflation and looming recession will do that. A ‘house divided’ is actually a welcoming sight for most right now so that the individual chambers can really focus on what’s good for all, and not just for some.

Chester Nash Real Estate Agent

Close

Chester Nash Real Estate Agent at Keller Williams Realty
5.0

Years of Experience 10

Transactions 203

Average Price Point $167k

Single Family Homes 196

New economic legislation could stall

Overall, divided national power will likely mean new economic moves will be slow, delayed, or cautiously passed with bipartisan support. Which means, at least in the short term, people who are frustrated with the economy may feel like they’re screaming into the abyss.

However, that doesn’t necessarily mean there’s no economic relief in sight for households that are struggling. Thomas says he believes the economy relies much more on the Federal Reserve than on anything legislators will do.

“I think the Fed’s going to operate independently and do what’s necessary to get inflation under control,” he says.

Nash adds that the new political makeup could also help leaders settle on housing and economic policies that are more effective.

“No, the midterms will not impact home sales prices,” she explains. “The inflation and looming recession will do that. A ‘house divided’ is actually a welcoming sight for most right now so that the individual chambers can really focus on what’s good for all, and not just for some.”

What do state-level elections mean for local housing markets?

Regardless of 2022 changes on the national scene, Dr. Longhofer says the most meaningful results of the midterm election for people interested in housing will be felt at the state and local levels.

“One thing that’s really important with housing markets, in general, is to recognize that there’s no such thing as the ‘national housing market,’” he explains. “Nobody owns the ‘average U.S. home.’ Everybody owns a home that’s in a particular city, it’s in a neighborhood within that city, and even in a particular location within that neighborhood.”

He says those micro-markets, and new measures passed within them, tend to influence a home buyer’s, seller’s, and owner’s life much more directly than national policy. And even as the national electorate seems set up to stall, voters across the nation are passing local housing proposals that may reshape your housing reality. Here’s how the 2022 midterm elections could influence local housing options:

Houses may become more affordable in some cities

Several local ballots held bond measures aimed at freeing up more low-income housing or reducing housing costs. Here are a few local markets that approved these types of moves:

Texas

In the city of Austin, voters approved a bond measure that set aside $350 million to help low-income homeowners with home repairs and for the city to develop more low-income housing.

North Carolina

State voters pushed through multiple bond packages to add, develop, or upgrade affordable housing. That includes a $40 million measure in Buncombe County and $226 million in bond funds in Charlotte.

Ohio

The citizens of Columbus approved bond funding to build more affordable housing facilities and to preserve affordable units within some areas where prices have risen. The move sets aside $200 million in bonds for the project.

California

Voters in several of the Golden State’s cities approved projects meant to promote more affordable housing. Here’s a list of a few cities where funds for low-cost housing passed, according to KQED:

Berkeley
Emeryville
Oakland
East Palo Alto
Palo Alto
Healdsburg

Voters in San Francisco did not pass Propositions D or E, local competing ballot measures that supporters said would have streamlined the process of building affordable housing.

Empty homes could incur extra fees

Following the midterms, you may be asked to pay extra when your home sits unoccupied in some cities. For instance, citizens in Berkeley and San Francisco voted to tax property owners who leave their homes or apartments intentionally unoccupied for longer than six months.

More housing opportunities in some areas

The midterm elections saw a number of efforts to increase housing opportunities. While some measures failed, others passed. For example, voters in San Diego narrowly passed ballot measure C, which excludes the 1,324-acre Midway-Pacific Highway Community Plan area from an existing 30-foot height limit on buildings. The measure may open up additional housing projects that can also help revitalize some plan-area neighborhoods.

Rent relief could be in sight

With inflation heating up the housing market, rent hit record highs in recent months. In response, voters in several cities cast ballots to cap rent prices. According to an Associated Press report, three cities passed measures to stop rent from rising above inflation:

Portland, Maine
Richmond, California
Santa Monica, California

Additionally, Orange County in Florida voted to stabilize rent in the local area, but that piece of legislation is being challenged in the courts. And Thomas says that even though the Orange County measure may not stand after it runs through the court system, the vote signals how high costs are cranking up pressure on local politicians to help lower rent.

“You get a ballot initiative like that and realize these places aren’t immune to regulatory risk,” he explains.“I think it suggests no market is immune to that type of pressure.”

What will the midterms mean for you?

Wondering what the 2022 Midterm Elections will mean for your unique housing situation? Experts suggest it will depend heavily on your local housing market, moves by the Federal Reserve, and broader economic conditions — all things federal politicians hold limited control over.

However, momentum seems to be growing for affordable housing and low-rent options on the local level. That could mean renters and homeowners may catch more breaks in the future.

For buyers and sellers, the future hinges largely on individual markets, inflation, and recession possibilities. But a handcuffed Congress could settle down housing markets and boost consumer confidence. It may also force lawmakers to come up with more sound solutions.

In the end, a torn government could also end up adding stability to the housing market — painting a more inviting scene for first-time homebuyers or skittish investors. Still, if you’re worried election results may foil your plans to buy a home, Dr. Longhofer suggests looking at your individual situation and needs rather than trying to time the market.

“Whether or not it’s a good time to buy a house depends on you more than the market,” he says. “If it’s a good time for you, any time can be a good time to buy a house.”

Don’t let midterm results shake your housing plans

Overall, the national midterm elections have resulted in a divided Congress with members who have little choice but to compromise. That means homeowners, buyers, and sellers likely won’t see new major housing policies race through Congress in the near future. Still, local midterms could bring some relief to cities where high costs are taking their toll.

In all cases, homeowners, buyers, and sellers who pay close attention to their local housing market, new local housing changes, and their personal situation will be positioned best to make the right housing decisions in 2023 and beyond.

If you have plans to sell or buy a home in the coming year, HomeLight can connect you with a top-performing real estate agent in your area who can help you successfully navigate the 2023 housing market.

Header Image Source: (yobro10 / Depositphotos)

from HomeLight Blog https://www.homelight.com/blog/election-results-housing-market-impacts-2023/

Tìm kiếm Blog này

BLOG TỔNG HỢP THÔNG TIN, TIN TỨC BẤT ĐỘNG SẢN - THỊ TRƯỜNG NHÀ ĐẤT