About every two years, real estate agents are asked “How will the election impact the real estate market?” In general, it’s a very small impact, though the good news is that it’s generally a positive impact. Here’s a post from two years ago to explain:
I’m often asked whether the market will pick up after the election, with the incoming administration. Whether the Republicans or Democrats win, a wave of new junior staffers and senior officials will sweep into Washington, DC. My guess is that the impact on the real estate market will be positive—by which I mean positive for sellers–for this reason: people who make a career of politics often don’t leave once they’re here.
What I mean is this: many of the current administration won’t leave, so it’s not a one-for-one swap in residents even with a complete turnover in administration. Some will have fallen in love with the area, some will have kids in schools or other local commitments that they don’t want to give up, many will be absorbed into local lobbying and law firms. So 100% of the current administration won’t be leaving. Of course there will be some houses put on the market, but I’m guessing not many.
On the flip side, though some of the next administration will undoubtedly already be living locally, there will be definitely be an influx of new residents as staffers and administration are relocated here from other parts of the country for their new appointments. Those people all need a place to live, whether it’s renting or buying. Junior staffers will undoubtedly rent, but senior officials and their families could just as easily look to buy—especially when they absorb the sticker shock of high rental prices in this area. They’ll likely decide this is certainly a good time to buy, with historically low rates, relatively high (though shrinking) level of inventory from which to choose, and their new four-to-eight year time horizon. The District and Arlington, after all, were recently named two of the top ten places to live in a recession, and our local real estate market has held up relatively well versus most of the country.
Since most of these new residents will be working in the District, I expect the real estate market to tighten in the District and close in, metro-accessible areas like Arlington, Alexandria, Bethesda, Silver Spring, Falls Church, and Vienna. Outer areas like Prince William likely won’t see a bump, but that’s okay—their current uptick is coming from the investor community.
Time will tell, but I predict that the incoming administration will cause a tightening of both the rental and purchase markets in close-in areas.
Are you a member of the new administration looking for help in understanding the local real estate market? Confused about where to rent or buy? I’m licensed in DC, VA, and MD and would love to help you. Contact me for an overview of the area and the local real estate trends.