The Real Deal Miami

Study shows slower home sales in election years

Paper published in British Journal of Science shows dip in home sales during election season
September 13, 2015 09:00AM

Home-sale study finds "election effect."

Home-sale study finds “election effect.”

Thinking of listing your home for sale next year? You might want to wait until after the 2016 elections.

In election years, home sales decline between 0.2 and 0.3 percent, according to a paper in the British Journal of Science by Brandice Canes-Wrone, a Princeton University economist and her co-author Jee-Kwang Park, an assistant professor at Nazarbayev University in Kazakstan.

The used data to examine home sales during 73 gubernatorial elections in 35 states in the 1999-2006 period.

Dr. Canes-Wrone said the reason the pace of home sales slows in election years is probably uncertainty among potential home buyers about the election’s impact on their financial position.

Her study with Park found that the so-called “election effect” was greater in closely contested elections. In election years when the winner got less than 55 percent of the votes, sales of homes declined by 0.33 to 0.5 percent.

Another analysis in 2012 by real estate site Movoto found slower home appreciation in presidential election years, based on a review of price data from the California Realtors Association.

Movoto found that sale prices rose 4.5 percent in election years, compared with 6 percent the year before and 5.3 percent the year after. [Wall Street Journal] — Mike Seemuth