Do Presidential Elections Slow Minneapolis Duplex Sales?

Would you believe presidential elections have little to no impact on home or investment property sales in the 5 months leading up to a presidential election?

John Burns Research & Consulting did a study that compared sales of new and existing homes in the 5 months before November in presidential election years, to non-election years.

They found new home sales drop 14% during that time and existing home sales decline 22% in those months in non-election years.

However, in election years, sales actually decline less! New home transactions fall just 10% and existing home sales declined 19%.

Of course, real estate is local. This data is based on sales nationally, not just the Twin Cities or state of Minnesota.

What about multifamily properties? Surely the threat of potential policy changes from new administrations would make duplex buyers and sellers cautious, wouldn’t it?

Yes and no. Data from the National Multi Housing Council (NMHC) found between 1996-2003, the average annual return on all REITS was 11.6% in non-election years, and 11.2% in years where voters were choosing a president. In 2004, apartment REITS saw a return of 34.7%, and in 2008, the annual return was -25.1%

You may recall 2008 was the year when the banking crisis caused the Great Recession.

In other words, the economy likely played a bigger role than the voters did.

Property owners are right to be concerned about how new presidential administrations, representatives at the federal and state level, as well as local city council members may impact multifamily policy. However, studies have found that concern is usually short-lived.

It seems investors are always willing to move on a good deal; regardless of politics.