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Here Comes Recession!
November 21, 2019 at 9:20am | Mac Rogers
been a lot of talk in the news lately about a recession. It’s important know how that may impact the housing market, particularly if you’re considering a move in the near future.
Hi, I’m Mac Rogers broker/owner of Albert Rogers Realty here in Castro Valley, CA.
So WHAT EXACTLY IS A RECESSION? Simply put, a recession means a time when the economy takes a dip for at least six months. We’re currently in the longest running economic recovery in American history. A slowdown is bound to happen. The graph shows you
when most economists think it will happen.
WHAT EXPERTS BELIEVE WILL CAUSE THE NEXT RECESSION
According to Yahoo Finance.
If an upcoming recession occurs, it will likely be due to trade policy, a geopolitical crisis, and/or stock market correction but NOT a housing slowdown.
A senior economist for realtor.com stated that This is going to be a much shorter recession than the last one. I don’t think the next recession will be a repeat of 2008…the housing market is in a better position,”
FIRST OF ALL RECESSION DOES NOT EQUAL HOUSING CRISIS The gravity of the 2008 crash, and how it affected the real estate market is impossible to forget. Here’s a fact of the last five recessions in U.S. history, three of them saw increases. Two of those
three saw prices appreciate faster than the historical average.
The 2 instances where priced decreased, one of them was by less than 2% and the other was because the housing market caused the recession in the first place. Historically, recessions are not caused by housing alone.
MARKET CONDITIONS ARE CLEARLY NOT THE SAME AS 2008. This is the biggest indicator that we won’t see a crash like the one a decade ago. Home prices are projected to appreciate for the next 2-5 years. Sales are also projected to increase in 2020.
The housing market remains strong and home prices are forecasted to continue to rise.
As you can see many of the same analysts who are projecting economic slowdown are also forecasting a rise in home values. Granted, it’s a slower rate of growth than we’ve had in the past 7-8 years, but it is growth nevertheless. So if you’re a buyer waiting
for prices to come crashing down before buying, that’s not likely to happen. The experts may disagree on how much appreciation we will see, but it’s worth noting there isn’t a single red number on this chart.
I hope this short video helps you out. Would love to see your comments and feedback below. I’m Mac with Albert Rogers Realty, I will see you at my next open house.