"Recession” – what is it?

Noun – a period of temporary economic decline during which trade and industrial activity are reduced, generally identified by a fall in GDP in two successive quarters.

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How does it impact home prices?

I’ve heard a lot of misconceptions from clients and realtors alike recently including:

1. Recession = 2008 – 2009

1. This was a very unique recession in that it was led by housing with a false inflation of demand for housing.

1. Home prices fall in recessions

1. Show clients the attached graph.  With the exception of 2008, home prices do well through recessions.  Recession periods are represented in the gray bars on the graph.

1. “CNBC says”…

1. Caution clients on national news.  Real estate is local.  A recession will impact the rust belt of Ohio very differently than the Denver metro area.

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I’ve sensed fear in home buyers recently so I hope these few talking points help us to ease those fears collectively.

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