Election Year Showdown: Should You Buy a Luxury Home in Los Angeles Now or Wait?
The 2024 election is heating up, and with it comes uncertainty in the Los Angeles luxury real estate market. If you’re eyeing a high-end home in West Hollywood, Beverly Hills, Bel Air, or Malibu, you’re probably asking yourself the big question: Should you buy now or wait until the political dust settles?
As someone who’s navigated LA’s high-stakes real estate market, I’ve seen how the real estate market can be shaken up. Here’s a detailed breakdown of why it might be smart to pull the trigger before the election, and why waiting could be worth it—but only if you’re willing to take a gamble.
Why You Should Buy Before the Election
Interest Rates: Lock in Favorable Rates Before They Rise
Let’s get straight to it—interest rates are unpredictable, especially in an election year. Right now, rates are still relatively low, but there’s a real risk they’ll rise post-election if the economy shifts or inflation spikes. Election results can trigger market reactions that lead to higher rates, and those higher rates can add up fast in the luxury market.If you’re looking at a $5 million+ property in Bel Air, even a small interest rate increase can mean paying hundreds of thousands more over the life of a mortgage. Why wait and gamble with potentially higher borrowing costs? Locking in today’s rates ensures you’re securing your home at the most favorable financing available.
Benefit from LA’s Current Market Stability
The Los Angeles luxury market is remarkably stable right now, with demand high and inventory low. Buyers are snapping up homes in places like Pacific Palisades and Brentwood, and prices are climbing steadily. However, the political uncertainty that comes with an election can shake this stability, creating volatility as buyers and sellers hold off to see what happens next.The smart move? Buy now, while the market is predictable and appreciating. If you wait, you could be stepping into a post-election market where changes in policies or taxes drive unpredictable behavior in both sellers and buyers. By purchasing now, you avoid potential volatility and capitalize on the current stability.
Take Advantage of Less Competition Before Buyers Flood Back In
Here’s the thing—election years scare off a lot of buyers. Many high-net-worth individuals take a “wait and see” approach, which means less competition in the luxury market. Typically, neighborhoods like Beverly Hills and Malibu are rife with bidding wars, but right now, with some buyers holding back, there’s less of a scramble.This is your moment. Fewer buyers mean fewer bidding wars, giving you more leverage to negotiate and secure the property you want. Once the election passes, buyers who were sitting on the sidelines could flood back into the market, driving up competition and prices. If you move now, you get ahead of that wave.
Maximize Tax Benefits Before Potential Changes
Election years often bring uncertainty around tax policies, and the 2024 election is no different. By purchasing a property before the end of the year, you lock in current tax deductions for mortgage interest, property taxes, and closing costs. These deductions can be significant, especially in the luxury market where the stakes are high.Waiting to buy after the election means gambling with potential changes in tax laws. If the new administration decides to overhaul tax policies, you could find yourself facing reduced deductions or new tax obligations that make homeownership less advantageous. By buying now, you maximize the tax benefits under the current system, avoiding any post-election surprises.
Why Waiting Until After the Election Could Pay Off
Will There Be a Market Adjustment?
The luxury real estate market in Los Angeles is resilient, but no market is immune to the effects of an election. Historically, we’ve seen election years cause a temporary slowdown in market activity as both buyers and sellers hesitate to make moves before political changes become clear. This hesitation can sometimes lead to slightly softened prices, particularly if sellers are anxious about post-election economic shifts.
However, let’s be real—luxury markets in places like Malibu and Bel Air are typically less volatile. While there may be some minor dips in pricing, it’s unlikely we’ll see dramatic drops. But if you’re patient and willing to take a risk, waiting could provide an opportunity to negotiate a slightly better deal—just don’t count on a massive discount.
Will Post-Election Policies Favor Buyers?
Depending on the outcome of the election, new policies could emerge that are favorable for real estate buyers. Tax incentives, lower capital gains taxes, or investment incentives aimed at stimulating the luxury market could all be part of the post-election landscape.
But here’s the catch—these policies are speculative, and relying on potential future changes is a risky strategy. Even if new incentives are introduced, the demand for luxury properties in LA is so strong that it may counteract any financial advantage these policies provide. And if these incentives don’t materialize, you could find yourself paying more in the long run by waiting.
Balancing Risk and Reward
At the end of the day, deciding whether to buy now or wait until after the election depends on your appetite for risk. If you’re looking to lock in favorable rates, avoid competition, and maximize current tax benefits, buying now is the smart play. On the flip side, if you’re willing to gamble on potential market adjustments or new policies, waiting could pay off—but it’s a risky move, especially in a high-demand market like LA’s luxury sector.
The Bottom Line: Make the Smart Move Now
As someone who’s guided countless clients through shifting markets, my advice is this: if you’re serious about buying in Los Angeles, make your move before the election. You’ll lock in low interest rates, avoid the post-election buyer frenzy, and take advantage of today’s tax benefits. Waiting? Sure, it could work out in your favor, but in a market like this, playing it safe often beats waiting for the perfect storm.
If you’re ready to talk strategy and secure your next luxury home, give me a call at (310)926-0028 or email me at brendan@plusrealestate. Let’s get you ahead of the competition and into the home of your dreams.
