Impact of the Election on the Local Housing Market
By Feven Woldu
Studies have shown that a change in administration does not usually affect our local housing market.
It was generally anticipated that a Trump victory would create uncertainty which favors bonds and causes stocks to sell. Instead, we got the complete opposite. Rates skyrocketed in the days and weeks in the single biggest move higher since mid-2013 and have continued with the same upward trend. The pressure on rates is attributed directly to Trump’s election and the possibility of larger deficits and an increase in inflation. Many clients have experienced four-six pricing changes in the days after the election offering some insight into current volatility.
An industry newsletter offered this insight: if President Trump is half as successful as his plans call for, the housing market will soar. We’ll all be happy with that. Buyers just need to be convinced that rates above the 3% range aren’t the end of the world. Our market is still holding strong despite the increase in interest rates--most people in politics are already here; they're just changing positions so it doesn't really impact the real estate market. Demographically, millennials will continue to live in the District and surrounds. The millennial home buying trend will have a continuing big impact.