Everywhere you turn, people are talking about a potential recession. And if you\u2019re planning to buy or sell a house, this may leave you wondering about the wisdom of your plans. To help ease your mind, experts are saying that if we do officially enter a recession, it will likely be mild and short. As the Federal Reserve <\/em>explained<\/a> in their March meeting:<\/p>\n\n\n\n \u201c. . . the staff\u2019s projection at the time of the March meeting included <\/em>a mild recession starting later this year, with a recovery over the subsequent two years<\/em><\/strong>.\u201d<\/em><\/p>\n<\/blockquote>\n\n\n\n While a recession may be on the horizon, it won\u2019t be one for the housing market record books like the crash in 2008. What we have to remember is that a recession doesn\u2019t always lead to a housing crisis.<\/strong><\/p>\n\n\n\n For proof, let\u2019s look at the historical data of what happened in real estate during previous recessions. <\/p>\n\n\n\n To show that home prices don\u2019t fall every time there\u2019s a recession, it helps to turn to historical data<\/a>. Reviewing recessions going all the way back to 1980, home prices appreciated in four of the last six of them. So historically, when the economy slows down, it doesn\u2019t mean home values will always fall.<\/p>\n\n\n\n Most people remember the housing crisis in 2008 and think another recession will be a repeat of what happened to the housing market then. But today\u2019s housing market isn\u2019t about to crash because the fundamentals of the market are different than they were in 2008. Back then, one of the big reasons prices fell was because there was a surplus of homes for sale at the same time distressed properties flooded the market. Today, the number of homes for sale is low, so while home prices may see slight declines in some areas and slight gains in others, a crash does not appear to be in the cards.\u00a0<\/p>\n\n\n\n What a recession really means for the housing market is falling mortgage rates. Historically<\/a>, each time the economy slowed down, mortgage rates decreased.<\/p>\n\n\n\n Bankrate<\/em> explains<\/a> mortgage rates typically fall during an economic slowdown:<\/p>\n\n\n\n \u201cDuring a traditional recession, the Fed will usually lower interest rates. This creates an incentive for people to spend money and stimulate the economy. <\/em>It also typically leads to more affordable mortgage rates, which leads to more opportunity for homebuyers<\/em><\/strong>.\u201d<\/em><\/p>\n<\/blockquote>\n\n\n\n This year, mortgage rates have been quite volatile as they\u2019ve responded to high inflation. The 30-year fixed mortgage rate<\/a> has hovered between roughly 6-7%, and that\u2019s impacted affordability<\/a> for many potential homebuyers.\u00a0<\/p>\n\n\n\n But, if there is a recession, history tells us mortgage rates may fall below that threshold, even though the days of 3% are behind us.<\/p>\n\n\n\n If we enter a recession, experts say it will be mild and short, and history suggests it will decrease mortgage rates. <\/p>\n\n\n\n <\/p>\n\n\n\n If you are considering a move, reach out. I would love to put my resources to work for you.<\/p>\n","protected":false},"excerpt":{"rendered":" 2 May 2023 ~ Everywhere you turn, people are talking about a potential recession. And if you\u2019re planning to buy or sell a house, this may leave you wondering about the wisdom of your plans. <\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_post_was_ever_published":false},"categories":[216,225,240,241,217,87],"tags":[231,232],"class_list":["post-10768","post","type-post","status-publish","format-standard","hentry","category-buyers","category-home-buyers","category-home-sellers","category-housing-market","category-sellers","category-trends","tag-home-values","tag-housing-market"],"featured_image_src":null,"featured_image_src_square":null,"author_info":{"display_name":"elizabethjebef","author_link":"https:\/\/elizabethjebef.com\/?author=2"},"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/elizabethjebef.com\/index.php?rest_route=\/wp\/v2\/posts\/10768","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/elizabethjebef.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/elizabethjebef.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/elizabethjebef.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/elizabethjebef.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=10768"}],"version-history":[{"count":0,"href":"https:\/\/elizabethjebef.com\/index.php?rest_route=\/wp\/v2\/posts\/10768\/revisions"}],"wp:attachment":[{"href":"https:\/\/elizabethjebef.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=10768"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/elizabethjebef.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=10768"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/elizabethjebef.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=10768"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}\n
A Recession Doesn\u2019t Mean Falling Home Prices<\/strong> <\/h4>\n\n\n\n
A Recession Means Falling Mortgage Rates<\/strong><\/h4>\n\n\n\n
\n