Do Midterm Elections Have A Historical Effect On Rental Prices?
2022 is a midterm election year, which means, all 435 seats in the House of Representatives and a third of Senate seats are up for grabs. Will these midterm elections have an effect on rental prices? Historically, the party in power loses representation in Congress, which could mean we are in for a shift to the right. So what could a Republican surge mean for real estate?
Midterm Elections Can Effect The Direction Of Economics & Rental Prices
To get a better idea about how mid-term elections impact rental prices, we first have to start with real estate appreciation and growth. In areas where an economy is healthy and thriving, the real estate market will benefit. More people will come to live in these areas and higher incomes will have people competing over rental homes and apartments. This increases the demand for real estate in a particular area, and therefore increases rental rates.
How A Midterm Election Party Control Can Effect Rental Prices in 2023
Traditionally, Republicans value supply-side economics. This is a strategy that focuses on reducing costs for business, trade, and investment to increase growth. Using this method, Investors buy more stocks and banks increase lending. This allows owners to invest more in their operations and employees. In turn, these workers make more money and spend more money. Putting money back into the economy and stimulating the economy further.
A shift towards a more Republican influence on the country can also impact job growth. Republicans value deep-rooted, business-friendly values that directly impact job growth which typically trickles down into real estate. Access to better, more consistent, and higher-paying jobs means people have more money to spend on rental property. This is good news for landlords that are thinking about increasing their rental rates.
Will The Midterms Affect The Los Angeles Metro Rental Prices?
So if all of the predictions are true, what will this shift mean for those buying, renting, and investing property in California? One of the things that will directly affect Californians will be inflation. A recent study stated, “roughly two-thirds of voters said price increases have caused them financial hardship amid high housing prices.”
The midterm elections seem to impact many economic markets significantly. The So Cal real estate market is its own beast however. Temecula should continue to see a slow and steady trend of rising house prices, declining inventory of rental units, and shorter market times. Even with these challenges, the Los Angeles Metro housing market is in better shape than many of its surrounding areas.
Back in February of last year, a home would stay on the market for 50 days before being sold. Currently, that number has been decreased to 36 days. This is a sign that regardless of who has power in Congress, the Temecula real estate market is strong.
The Bottom Line | Are Midterms A Negative Headwind For Investment Property?
What does all this mean for buyers, renters, and investors in the California area? A shift towards a more Republican influence may have an impact on taxes and job growth. It should not be the deciding factor on whether or not you decide to jump into the California real estate market. There has been consistent demand for rental properties in California during most party changes, especially in the Temecula and Murrieta areas.
If you want to learn more about how local and national politics may impact your Temecula Area property investment, schedule a chat with us today! Benefit National is the premier choice for Temecula Property Management.