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Updated about 2 years ago, 11/09/2022
Political results impact the real estate industry. Yes or No?
Had an interesting discussion in the Department Heads group today where our CEO who has done more than 3000+ transactions and has an industry experience of 20+ years opined on the possibility of the election results impacting RE.
When asked how do political results impact RE, he said, "the Real estate market slows in election years. Presidential election years are the worst, but any major election slows the market. Voters usually begin to believe that if their candidate loses, the world is going straight to hell. So they do not invest, but if their candidate wins, they go bullish! The voters whose prospect wins spend money, they believe the world will be awesome! The voters whose prospects lost spend money because they can’t do a thing about it until the next election lol!"
This got me thinking about how user behaviour changes per the market. To me, this falls under the category of complex buying behaviour triggered by a confirmation bias.
Complex buying behaviour is encountered particularly when consumers are buying an expensive product. In this infrequent transaction, consumers are highly involved in the purchase decision. Consumers will research thoroughly before committing to investing.
Confirmation bias takes over when the new information processed by the human mind confirms pre-existing beliefs. Here the pre-existing belief is that if their candidate wins the world will be amazing and if the candidate loses, the world will turn upside down. Humans tend to hold on to their beliefs strongly and look for confirmation of such beliefs. For instance, if a brand can create a situation where it can affirm the belief of the consumer pertaining to certain ingredients of the product, it is more likely to be a success in the market.
How do the election results impact buying behaviour in the market? Would love to know your take on the subject.