For the sake of consistency, we collected all of our data from two sources: the Historical Mortgage Rate Data website that lists national average mortgage rates since 1992 and HSH’s National Monthly Mortgage Statistics which tracks rates prior to 1992. While we’ll look at a fairly short time frame, we can still scope the mortgage interest rates as they react to five (going on six) presidential elections. Let’s take a look at the average interest rate by month, starting in September of the election year and running through the February after inauguration (just to see if having a new president in office seems to make a difference).
Mortgage Rates Election Year 2004
For the 2004 election, Bush is reelected into office and the months immediately following the election seem to reflect a slow but steady decline in average national mortgage interest rates.
Mortgage Rates Election Year 2000
For the 2000 presidential election between Gore and Bush we see a significant drop in mortgage interest rates after the election, and a drop nearly 3/4 of a point by his inauguration.
Mortgage Rates Election Year 1996
For the election of 1996, Clinton’s reelection, we see a variation in rates, decreasing steadily through the election. And with the exception of a small jump in January, continuing as such in February.
Mortgage Rates Election Year 1992
1992’s election that Clinton won over Bush Sr. reflects a steady drop in interest rates after the election, with the most significant drop taking place after inauguration.
Mortgage Rates Election Year 1988
The 1999 election marking the end of Reagan’s term and the beginning of Bush’s shows us no steady trend in either rising or falling interest rates. They slowly decline up to the election, then climb and vacillate after November.
So what can we gather from these election-year trends? Of course we can’t predict the future of national mortgage interest rates, but we can note that in three out of the five past election years we observe a slow (and small) but trackable decline in mortgage interest rates. This decline is most evident between the months of November and February, then in the months following (beginning in March) rates begin to fluctuate significantly abandoning the trend. And none of the changes in interest rates that we have tracked seem to rely on whether there is a change of hands in office.
As we can expect from interest rates, they aren’t giving up many secrets to their plans in the future. However we can still confirm that mortgage interest rates are still near historic lows, which means purchasing a home or refinancing is still a timely decision.
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