A recent poll shows that the upcoming presidential election is putting the Pause button on a selection of potential buyers. An article on the website Real Estate Economy Watch: “The Election is Tanking Home Sales“, recently found that as many as 25% of potential buyers are holding off until after the elections to see who is seated as president. Potential changes in capital gains and the deduction for mortgage interest being cited as two of the reasons. Luckily this happens only once every 4 years.
On the flip side, another article from the same website claims that real estate investors are geared up for purchases. In “Real Estate Investors are Bullish“, home purchasers are poised in high gear to pick up properties this year.
So which way is it? Why such conflicting articles on the real estate market? Our take is that the type of property is what makes the two articles so different. From talking with many of our wealthier clients, the election is affecting the decision to purchase property for more personal use. Some higher end buyers are playing the waiting game for purchases of second homes and more expensive investment property for holding because of the reasons cited in the first article. While on the other side, purely investment buyers are bullish and looking at picking up more lower end rental properties and buying homes that need rehab to then either rent or flip. This shows true in our market where bank owned and short sales are still tapping about 40% of the sales in the Flathead Valley. So in the end, I think both articles are fairly accurate – it just depends on which end of the market you are looking at.
