Housing market angst won’t swing the election (probably) 

Every election cycle, pundits and politicians debate the "dinner table" issues affecting U.S. voters, and many Americans are frustrated by concerns like inflation and the cost of housing.

Rents are high. Home prices are at near-record levels. Mortgage rates have barely budged. 

But will voters be thinking about housing costs when they go to the polls this November? That might depend on whether they're a homeowner, where they live and how old they are.

Two new reports from Redfin look at the potential impact of housing affordability on the election, especially in swing states. The conclusion? Housing affordability is a very real problem, but among likely voters, it may not be an election decider.

Economists don't expect housing to be a top voting issue

While young people are struggling with high rents and discouraged about their ability to buy a home, they are in the minority — and less likely to vote — said Chen Zhao, Redfin economics research team lead.

"If you're focused on housing, 66% of Americans are homeowners. The percentage of likely voters who own homes is even higher, with older generations more likely to vote than their younger counterparts. They have an asset that just keeps appreciating in value," she said.

"There are a lot of things on voters' minds right now," added Redfin Senior Economist Elijah de la Campa. "Housing affordability touches the lives of all Americans, but it is also a crisis that's more acutely felt by the renting population," de la Campa noted. 

For the youngest voters, however, affordability is a key election issue. The question, however, is whether it will drive them to the polls, and how it might influence their vote. 

'Recency bias' could give Trump an edge

Housing issues may not be a top priority for most voters, but that doesn't mean Americans aren't looking for someone to blame — and that's often the incumbent.

"The average person sees mortgage rates are really high, they see home prices are really high, and they see Biden in the White House, not really helping prices or mortgage rates come down," de la Campa said. 

But some are concerned that Trump's economic and housing policies could make matters worse. Both candidates have offered up proposals to address the high cost of housing, but "I don't think either of them has really done all that much to improve housing affordability," said Zhao.

The fate of rates could help Biden

The Federal Reserve hasn't cut interest rates in more than four years, driving up mortgage rates — but that is likely to change in September, when most economists expect a 25 basis point cut. Any improvement in affordability following a rate cut could flip that "recency bias" back to Biden, giving him a bump.

"As for buyers, they would see potential monthly mortgage payments becoming more affordable and start looking at the housing market in a more positive light. Those people are marginal voters and it does shift their perception of the economy in a big way," said Daryl Fairweather, Redfin chief economist.

Swing states are feeling the pinch

The outcome of presidential elections often comes down to voters in swing states, and since the last election, housing payments in swing states — Arizona, Nevada, Wisconsin, Michigan, Pennsylvania, Georgia and North Carolina — have nearly doubled, Redfin reported. 

In 2020, the typical swing-state household would have spent 22% of their monthly income on housing costs; today, that figure is 33%, exceeding the 30% affordability threshold. 

Renters are feeling the pressure, especially in swing-state cities like Milwaukee and Detroit, Fairweather said. "But people in cities like those tend to vote Democrat and I don't think they are likely to change their vote from Biden to Trump, even if they thought he would lessen their rent pain."

And many voters are simply prioritizing other issues, said Zhao. 

"Typical swing voters are young families living in the suburbs — people who are less likely to be worried about housing affordability."