As the presidential election approaches, real estate markets are defying historical patterns while confronting a deepening housing affordability crisis. This unusual convergence is forcing both candidates to address immediate market dynamics and long-term housing challenges.
Market Shows Unexpected Resilience
While presidential elections typically trigger real estate hesitancy, major metropolitan areas are experiencing what industry leaders call a “pre-election bump.” The Witkoff Group and Naftali Group report combined sales exceeding $503 million this year in Manhattan alone, with flagship projects like One High Line doubling October sales compared to summer figures.
“The strong sales momentum wasn’t something we necessarily expected,” notes The Witkoff Group co-CEO Alex Witkoff. “It suggests growing sentiment among buyers who recognize the opportunity to secure prime real estate assets amid potential regulatory changes.”
Housing Crisis Demands Solutions
This market vitality, however, masks a broader housing affordability crisis. Home prices have surged approximately 50% in the last five years, significantly outpacing wage growth. Both candidates acknowledge the severity of the situation, though their proposed solutions differ markedly.
Harris’s Comprehensive Approach
Vice President Harris’s strategy combines market intervention with consumer protection:
- Supply Expansion: Plans to construct three million new housing units through:
- Enhanced tax credits for affordable rental housing
- New incentives for starter home construction
- $40 billion fund for innovative construction methods
- Buyer Support: Proposes $25,000 in down payment assistance for first-time buyers
- Supporters view it as crucial for homeownership access
- Critics, including AEI economist Michael Strain, warn of potential price inflation
- Market Regulation: Legislation targeting corporate landlords and algorithmic pricing
Trump’s Market-Driven Solutions
Former President Trump, leveraging his real estate background, emphasizes deregulation and broader economic factors:
- Expanded housing development on federal lands
- Streamlined construction regulations
- Focus on reducing mortgage rates through economic policy
- Immigration reform to address housing demand pressures
Market Implications and Industry Response
“The real estate landscape prioritizes long-term stability over electoral outcomes,” explains Naftali Group Chairman Miki Naftali. “Buyers in top markets are sophisticated and focus on fundamentals.”
The current surge in luxury real estate activity suggests investors are looking beyond immediate political uncertainty. However, industry experts note that addressing the broader housing crisis requires balancing market dynamics with accessibility:
- Local factors continue driving luxury market decisions
- Supply constraints remain a critical challenge
- Mortgage rates, currently at 6.72%, influence buyer behavior
- Construction financing availability affects development pipelines
Looking Beyond Election Day
While markets may appear neutral, the industry recognizes distinct implications from each candidate’s approach. Harris’s interventionist strategy promises more direct support for affordable housing but raises questions about market efficiency. Trump’s deregulatory focus appeals to developers but faces challenges in addressing immediate affordability concerns.
“Either candidate will need to focus on getting the economy better,” notes Naftali. “The winner’s ability to implement their housing agenda while maintaining market stability will be crucial for the industry’s long-term health.”
As election day approaches, the real estate sector’s unusual resilience, combined with pressing affordability challenges, suggests that housing policy will remain a critical focus regardless of the outcome. The industry’s ability to adapt to new regulatory frameworks while addressing accessibility concerns will likely define its trajectory in the coming years.