It might seem like a stretch to believe, but the outcome of this election – no matter who wins what – will have an impact on the real estate market.
In fact, politics at the federal level is one of the most important factors influencing home prices and real estate activity. That’s because politics affects the economy, interest rates, mortgage rates, property taxes, property insurance, employment, retirement, immigration, and where people want to live or don’t want to live.
State and local politics also affect home prices. For example, municipal legislation by cities and towns authorizing funds to pay for more parks or community centers instead of improving roads or expanding the police force (or vice versa) might affect the desirability of neighborhoods and/or the cost of living there.
It appears that some politicians are more focused on getting elected or re-elected than on getting things done that matter most to their homeowner and home renter constituents … and which may result in higher taxes, less services, poor service, and possibly higher costs, all of which affect real estate prices.
In our area, politicians are concerned about affordable housing. It is an issue because it’s difficult to get workers to support our resort- and retirement-oriented economy. There are also many commercial properties that have been vacated by businesses that could not make it … another problem and an eye-sore as well.
Politicians are also worried about the economy. When businesses go bust and leave, so do the taxes that they paid. This may result in increased property taxes for current property owners. Fortunately our area is growing and new home buyers from up north are thrilled with the much lower property taxes here than there.
Foreclosures are another political dilemma. Remember the housing crash? Even though things are better now, there are still a lot of homeowners who are delinquent in their mortgage payments. Fortunately, many homeowners have taken advantage of historic low interest rates, have refinanced and lowered their monthly costs.
As we await results of the election, many homeowners are wondering if a new president and a change in Congress will affect the state of real estate and home prices. It all depends upon how a number of real estate issues will be handled.
Politically speaking, will the government: set the stage for economic growth and recovery, encourage mortgage subsidizing, support affordable housing, keep the interest rates low, and pass legislation to increase housing opportunities for all Americans?
Just to be clear, I am saying that the government could and should be a catalyst in providing the right climate for handling the above issues. I am also saying that politics strongly affects home prices and the real estate market.
Larry Stoller is a broker and Realtor with Real Estate Five of the Lowcountry. Larry@RealEstateFive.com, RealEstateFive.com, SunCityOpenHouses247.com