The real estate market is heating up, and it’s not just affecting homebuyers. New research suggests that rising home prices could have a significant impact on the upcoming presidential election, potentially giving Vice President Kamala Harris an edge in key swing states.
Nationally, home prices have skyrocketed by 47% over the past four years, according to the S&P CoreLogic Case-Shiller Home Price Index. While this surge has made homeownership increasingly difficult for first-time buyers, it could actually benefit the incumbent party, according to a study by Eren Cifci, assistant professor of finance at Austin Peay State University.
Cifci’s research, which analyzed six presidential elections from 2000 to 2020, found a clear pattern: counties experiencing stronger home price gains tend to favor the incumbent party’s candidate. This trend holds true even when a different candidate from the incumbent party is running.
“In our study, we found that when an incumbent party candidate runs for reelection, voters respond more strongly to increases in their home values and tend to favor the incumbent party,” Cifci explained. “We also found evidence that voters tend to favor the incumbent party even if a different candidate from the incumbent party runs for the election.”
This finding is particularly relevant given the current housing market. The National Association of Realtors estimates a national housing shortage of at least 1.5 million units, driving up prices and making affordability a major issue for both campaigns.
The Trump campaign has blamed Democratic policies for the housing affordability crisis, while Harris has outlined plans to increase the availability of starter homes. Homeowners, who make up nearly two-thirds of housing units nationwide, could play a crucial role in the election. This demographic typically demonstrates higher voter registration and turnout rates compared to renters.
While the study suggests a potential advantage for Harris, Cifci emphasizes that the housing market is just one factor influencing voter behavior. “There are multiple dynamics at play and several unique aspects of this election. I think it is hard to say with certainty how each factor will influence voter behavior,” he said.
The housing market’s influence on voter behavior mirrors the historical impact of the stock market on incumbent support. While Harris may not benefit as strongly as an incumbent president would, the research suggests that rising home values could still work in her favor, particularly in closely contested counties.
With the election still months away, it remains to be seen whether the housing market’s performance will ultimately sway voters. However, Cifci’s research provides valuable insight into the potential impact of economic factors on political outcomes.