Should You Worry About “Recession” When It Comes to Real Estate?
Let’s be honest—every time the word “recession” starts popping up in the headlines, it can make anyone pause, especially if you’re thinking about buying or selling a home.
You might be wondering:
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Are home prices going to crash?
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Will mortgage rates shoot up again?
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Should I just wait this out?
Totally fair questions—and you’re not alone. The good news? We don’t have to guess. We can look at what’s actually happened in the past to help us make smart, informed decisions.
A Recession ≠ A Housing Crash
First things first: Just because there’s a recession doesn’t mean we’re headed for a housing meltdown.
In fact, in 4 of the last 6 U.S. recessions, home prices actually went up. And in one of those other two, they only dipped about 2%. The big exception was 2008—and that was a very different situation: risky lending, overbuilding, and a financial system on the edge.
So no, history doesn’t show home prices crashing every time the economy slows.
What Usually Happens?
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Home prices might cool off a bit, but not collapse.
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Buyer activity can slow—but that doesn’t mean there’s no market.
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Every local area reacts differently. Here in San Diego, limited inventory keeps things moving even when other markets slow down.
What About Mortgage Rates?
Here’s the part that surprises most people: Mortgage rates tend to go down during a recession.
In all six of the last U.S. recessions, interest rates dropped. That’s because the Fed usually steps in to stimulate the economy by lowering rates—and that can make borrowing more affordable.
Now, we probably won’t see the ultra-low 3% rates again anytime soon, but even a small dip can make a big difference in your monthly payment.
Today’s Homeowners Are In a Strong Spot
Unlike 2008, homeowners now have serious equity. Thanks to years of appreciation, people are sitting on solid cushions.
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Even if home prices dropped 10%, equity would still be at 69.5%—similar to 2021 levels.
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A 20% drop would only take us back to 2019 equity levels.
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And over half of homeowners have mortgage rates below 4%—they’re not in a hurry to sell unless they want to.
That kind of stability helps prevent major price drops or a flood of distressed sales.
Bottom Line
Yes, the economy may shift. But that doesn’t mean your home plans need to go on hold.
If you’re thinking about buying or selling, it’s not about trying to time the market perfectly—it’s about making the right move for you and your life.
If you have questions about how today’s market could impact your goals, let’s talk. I’m here to help you navigate it all, with strategy and heart—not fear. Book a call with me here: https://calendly.com/shellyoneil
