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How will Joe Biden’s presidency affect home prices?

NATIONAL INSIGHTS

We think that home prices will rise during Biden’s presidency.

Will home prices go up during Biden's presidency?

Here’s why

$15K Grant to First Time Home Buyers

Biden has stated his intent to create a new tax credit for first-time homeowners of around $15,000. According to Lawrence Yun, the Chief Economist of the National Association of Realtors, this “can go a long way in terms of helping first-time homebuyers and minority households.” By making homeownership more attainable for more young adults and new families, demand will go up. Anytime demand increases – prices follow.

Low Interest Rates

The federal interest rates are currently at a major low point – and many anticipate this to continue. Many home buyers will continue to take advantage of this, causing home demand to increase even further. Anytime demand increases – prices follow.

More Jobs

Biden ran his campaign promising a new infrastructure bill that will create thousands of jobs in the clean energy sector. Assuming that this bill passes, we’re likely to see a surge of new jobs – meaning more income for more families and giving more people the stability to buy a home.

Stimulus Checks

$1,400 stimulus checks are likely on the way! This could be used toward down payment savings, further lifting demand and prices.

SALT Improvement

We may also see improvements on state and local taxes, which would majorly benefit homeowners in highly taxed areas (CA, NJ, NY). This could produce fewer sales, leaving a high demand to supply ratio and therefore higher prices.

Student Loan Forgiveness

On top of that, Biden may be reducing student loan debt, putting young Americans in a more stable position. According to Stessa, “this coupled with down payment incentives can significantly increase the buyer pool, driving up demand, and prices.”

But there are some risks

The housing market is delicate and can be easily disturbed by things that can’t be controlled, such as…

  • Oversupply of housing. Although we’re in a housing shortage, developers are insanely excited. Their sentiment is near an all-time high, much (much) higher than pre-2008! If they oversupply the market, prices will crash.
  • Forbearance program. If congress stops extending the forbearance program, it could push millions of homes towards foreclosures and crash the housing market.
  • Stock market crash. The stock market is hanging by a thread. Most of the growth is coming from a small handful of stocks. If they crash, demand for housing will crash along with it, and we will see massive foreclosures.
  • Stock market crash. The stock market is hanging by a thread. Most of the growth is coming from a small handful of stocks. If they crash, demand for housing will crash along with it, and we will see massive foreclosures.
  • Natural disasters. Increasing rates of fires, floods, hurricanes, and earthquakes could crash housing markets in high-risk locations.

All in all

We will likely see a housing market boom along with the economy as Biden takes control.

If you’re delaying buying your home, it may not get better in the short-term barring a major black swan event.

Buy your home 🏡

Get up to $500K down payment assistance from Home.LLC!

It’s an investment, not a loan. there are no monthly payments, ever!

Vinay Jain

Vinay built Home.LLC

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