4 Things a Kamala Harris Administration Could Do To Boost the Housing Market
The 2024 U.S. presidential election is just a few months away. When a new president takes office, people usually worry about how the outcome will affect things like the housing market.
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It’s possible that Kamala Harris could bring big changes to the housing market if she wins. According to experts we spoke with, her administration can take several steps toward improving the housing market for Americans across the country, and make a real impact on people’s lives.
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Home Prices Will Likely Rise Regardless of Who Wins
History has shown that the market is actually quite stable, even during political changes. Home prices have consistently gone up, no matter if it’s an election year or not. The housing market is less affected than other parts of the economy by the short-term ups and downs of the election cycle..
“Generally speaking, home prices are very resilient and typically rise year over year, regardless of elections,” said Amy Lessinger, president of RE/MAX. “Over the last 40 years, home prices have increased by an average of 4.84% in election years and 4.44% in non-election years. While this difference is nominal, data from the National Association of Realtors shows that in seven of the last eight presidential elections, home prices increased the following year. This is likely because people hold off on buying, waiting to see what will happen, causing a temporary pause.”
Some potential homebuyers wait to see what will happen with the election before buying a house. These buyers jump into the market once the election is over, leading to more home sales and higher prices.
“History is a great teacher — we’ve seen that historically home sales tend to go up the year following an election, having done so nine out of 11 elections,” said Lessinger. “While sales might slow leading up to the election, there is usually an increase the following year. Additionally, home prices have gone up in 10 of the last 11 elections.”
The housing market not only weathers political changes, but can even get stronger as people who held off on buying now enter the market. No matter which party controls the White House, homebuyers and sellers should be prepared for continued price appreciation in the years ahead. However, here are four moves the Harris administration could make to boost the market even more.
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1. Increase Affordable Housing
Harris is likely to push for more funding for affordable housing.
“Homeownership has become unaffordable for the average American,” said Thomas J. Brock, expert contributor at Annuity.org. “If Harris wins the presidency and Democrats take control of Congress, I would like to see the robust implementation of supply-side incentives and demand-side regulation to address the problem.”
This could take the form of investing in construction of more affordable housing units, with a focus on areas where housing costs are high and supply is limited. It’s hard to find affordable housing anywhere, but especially in big cities. Harris might start by targeting these areas. This might mean partnering with state and local governments to provide funding, tax incentives, and other resources to developers who prioritize building affordable homes.
“The Harris administration could focus on building more affordable housing units to help lower-income families find homes,” said Yancy Forsythe, founder of Missouri Valley Homes.
An investment like this could also mean a lot of new construction projects. This could mean both renters and homebuyers have more housing options. And an increase in supply could lower costs for everyone.
2. Expand First-Time Homebuyer Programs
Harris could create or strengthen tax incentives and programs meant to make homeownership more accessible for first-time buyers.
As Brock said, Harris should “expand down payment assistance programs, low-rate financing arrangements and homeowner tax credits, including green initiatives, to make homeownership more accessible and sustainable.”
This would help prospective homeowners overcome the significant hurdles associated with buying a home. Many people who dream of owning a home find that saving for the down payment is one of the biggest barriers they face. Biden has proposed a bill to give families a tax credit of up to $15,000 to help cover down payments and closing costs when buying their first home. If she wins, Harris would likely push for this to become a law.
“Offering more incentives and support to first-time homebuyers can encourage more people to enter the market,” said Forsythe.
This could also have a ripple effect on the housing market, as increased demand for homes drives up prices and encourages more construction and investment in the sector.
3. Support Sustainable Building Practices
It’s likely that the Harris administration might prioritize and promote sustainable building. This might mean stricter energy efficiency standards for new construction, and also give incentives to encourage retrofitting existing homes.
“Promoting eco-friendly building practices could lead to long-term savings and environmental benefits,” said Forsythe.
Renewable energy sources like solar panels don’t just reduce carbon footprints, they also give homeowners a way to generate their own clean energy and save money on their utility bills. Harris would be helping fight against climate change by supporting these eco-friendly housing strategies. But she would also be helping reduce everyone’s long-term heating, cooling, and energy costs.
4. Strengthen Tenant Protections
Harris could also focus on expanding protections for renters to address housing insecurity and displacement. This would mean strengthening eviction prevention programs, and could also include policies that limit rent increases.
“Protecting renters’ rights and offering more stability can increase overall confidence in the housing market,” said Forsythe.
These measures could have a positive impact on the entire housing landscape. Greater tenant protections could mean more renters choose to rent for longer instead of buying a home. This could mean fewer people looking to buy their first home.
Editor’s note on election coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic here: I’m an Economist: Here’s My Prediction for the Housing Market If Trump Wins the Election.
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This article originally appeared on GOBankingRates.com: 4 Things a Kamala Harris Administration Could Do To Boost the Housing Market