Swing State Housing Prices Could Sway 2024 Election
As the 2024 presidential election approaches, the nation is turning its attention to home prices and housing affordability, particularly in the swing states that could determine the outcome of the election.
Red states tend to offer greater affordability compared to the national average, while blue states are generally more expensive, according to a report from Realtor.com. Swing states strike a balance, sitting slightly above the national average in terms of affordability, even as general affordability declines nationwide.
In his State of the Union speech this spring, President Joe Biden proposed tax credits for some buyers and sellers to address housing affordability as well as measures to boost construction. In response, Donald Trump accused Biden of attacking the suburban lifestyle, which would reduce home values.
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"Generally, states that vote Republican are more affordable than the U.S. as a whole, and states that vote Democrat are less affordable," Realtor.com senior economic data analyst Hannah Jones said. "Swing states tend to be more affordable than the U.S. average, though less affordable than Republican states, on average. This dynamic remained intact as affordability worsened across all states and the U.S. between 2021 and today."
Jones noted that housing affordability increased between 2018 and 2021 before dropping in 2022 and 2023 as home prices and mortgage rates increased faster than wage growth.
"All states across the U.S. experienced this deterioration in affordability," Jones said. "Mortgage rates and home prices have hovered around the same level over the last year, which means that nationally, affordability has not gotten significantly worse, but it has not improved much either."
Census data indicates that states typically voting Republican tend to be more rural. The lower population density may help alleviate the housing crisis in these states.
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Kenneth Chilton, associate professor of public administration at Tennessee State University, said variations in home affordability between red and blue states could be the result of basic geographical differences.
"Red states tend to be Southern, and historically have had lower household incomes," Chilton said. "In blue states, you're going to capture California and New York and some of the states that have the highest housing prices in the country."
Alex Schwartz, a professor of urban policy at The New School in Manhattan, New York, said blue states are more vibrant and prosperous than Southern states, increasing the demand for housing.
"The Midwestern states have been struggling economically for years," Schwartz said. "When you have a weaker economy, house prices are definitely lower."
The median list price for homes nationally reached $429,950 last month, a 44% increase since January 2020, according to Realtor.com. The sharp rise in home prices benefits homeowners but poses a significant challenge for prospective buyers, particularly renters looking to purchase their first home.
Polls indicate that housing affordability is a top concern for voters, though it's unclear which party stands to gain the most from the issue.
Biden has prioritized housing affordability in his reelection campaign, proposing a $10,000 tax credit for first-time homebuyers and people selling their starter homes. Trump says Biden's proposals would diminish the values of existing homeowners' properties.
Nevada and Arizona are the swing states with significant affordability issues, and voters there may be more inclined to consider the housing crisis when making their decisions.
"That's definitely going to be an issue for voters here," said Maurice Page, executive director of the Nevada Housing Coalition. "No one should have to choose between paying rent, mortgage, child care, health benefits or how much food they can put in their pantry. So that is going to be a major issue. It's going to be a major hurdle throughout the local elections as well as state and federal."
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