How to Understand the Effects of a Recession on Your Plans to Sell Your Home
Don’t let the news of the economy slowing down worry you. Recessions are a reality of the wave-like economic landscape, while they’re not exactly something to be lauded, they don’t necessarily affect the housing market like they do others. Read on to get see why, but first to set the stage, let’s get an update on the current economic reality:
Update on the Economy
So, the while the economy is still stable, most experts believe the economy is in for a slow down in the coming months. According to the National Association for Business Economics February 2019 Economic Policy Survey, the majority believe a slowdown is coming.
“While only 10% of panelists expect a recession in 2019, 42% say a recession will happen in 2020, and 25% expect one in 2021.”
Several other surveys concur, including the Pulsenomics Survey of Market Analysts and the Wall Street Journal Survey of Economists. So, chances are, unless there is some unexpected rebound, a recession is coming.
So, how do you, as a potential home seller, gauge what a recession could mean to your home sale plans?
The History of Recession and the Housing Market
The country has a long track record of recessions and positive housing market activity, so the most important thing to remember right now is that fact.
Here’s the crib notes version of economic recessions and the housing market:
• January 1980 to July 1980: Home values rose 4.5%
• July 1981 to November 1982: Home values rose 1.9%
• July 1990 to March 1991: Home values fell less than 1%
• March 2001 to November 2001: Home values rose 4.8%
So, as you can see, home values still followed positive trends during the downturn. There is nothing to worry about if the economy turns slow, at least for your home sale potential. As Ralph McLaughlin, CoreLogic’s Deputy Chief Economist noted recently, ““There’s no reason to panic right now, even if we may be headed for a recession. We’re seeing a cooling of the housing market, but nothing that indicates a crash.”
So, stay the course for your home sale plans. Spring is almost here and recession or no, your home value should stay stable.