The word recession is now more emotionally charged than ever before since the 2008 housing bubble burst. Even though there is some debate over whether we’re in a recession right now, the good news is experts say that if we were to enter into a recession today, it would likely be mild and the economy would rebound quickly.
Housing is typically one of the first sectors to rebound during a slowdown, which can provide stability to the economy as a whole.
Mortgage rates have a tendency to rebound during recessions. This is partially due to what has happened historically, with rates dropping during recessions and then rebounding when the economy starts to improve. So, if you’re worried about how mortgage rates might behave during the next recession, don’t be – they’re likely to rebound fairly quickly.
Mortgage Rates During A Recession
The graph below illustrates how, historically, when the economy has slowed down, mortgage rates have decreased. This could be indicative of how a recession could impact the cost of financing a home.
The average mortgage rate has fallen by 1.8 percentage points since the peak seen during each recession. In many cases, rates continued to fall after the recession was technically over. This shows that it takes some time to turn things around, even when the recession is technically over.
The housing market is always changing, and it can be tricky to know what to do when a recession hits. If you’re thinking about buying or selling a home, it’s important to work with a trusted real estate professional. They’ll be able to give you expert advice on how the recession could impact the housing market. That way, you can make the best decision for your family.
To Sum It Up
It’s okay to be afraid of the word recession when it comes to the housing market. If you’re not sure what’s happening today, work with a real estate professional for expert advice and insights.