Reddit
reddit.com › r/firsttimehomebuyer › can someone explain what a recession does to the housing market?
r/FirstTimeHomeBuyer on Reddit: can someone explain what a recession does to the housing market?
April 15, 2025 -
I am saving up for a down payment and am hoping to have enough to buy next year in July. But I'm hearing lots of talk about a recession.
Should I be considering how this will affect my housing search next year? Is there any way to plan through/around that?
Top answer 1 of 5
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Hard to predict because many different things could happen. Demand will likely go down, so that could bring home prices down. But if rates also come down, then home prices could stagnate or go up depending on demand. Inflation could also bring prices up and interest rates up, unless demand go down significantly. You could also see more investors using housing as a place to park investments, so that could make it difficult to buy entry level homes without cash on hand. Long story short, no one knows for sure. Save up for down payment. Build your credit score. Buy when the time is right for you and you feel comfortable.
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The principal thing to concern yourself with is the possibility that you'll lose your job. Beyond this, the impact of a recession ia somewhat uncertain. In general, it will put downward pressure on prices but amidst a really binding supply squeeze, this might not translate into appreciably lower prices unless the recession is very severe.
Chicago Sun-Times
chicago.suntimes.com › real-estate › 2025 › 05 › 03 › chicago-housing-market-dampened-recession-fears-tariffs
Chicago's housing market could be further dampened by recession fears and tariffs - Chicago Sun-Times
May 3, 2025 - But tariffs can also have a recessionary impact if consumers pull back from spending because of higher prices, Zhao said. Depending on how tariffs impact the economy, it could influence the Federal Reserve to cut rates. Zhao said what happens depends on if the inflationary impact of tariffs is long or short term. If inflation isn’t temporary and the Fed doesn’t cut rates, the U.S. could see higher interest rates alongside a recession. “That’s a very bad situation for the housing market because it means that there’s not a lot of demand, because people are worried about their jobs and their finances,” Zhao said “But it also means that you don’t have the normal mortgage rate relief that you normally get in a recession to help stimulate the housing market.”
Is it smart to buy real estate before a recession?
If you’re in a financial position to buy a home you plan to live in for the long term, it won’t matter when you buy it because you will live in it through economic highs and lows. However, if you are looking to buy real estate as a short-term investment, it will come with more risk if you buy at the height before a recession.
forbes.com
forbes.com › advisor › mortgages › real estate
Housing Market Predictions For 2026: When Will Home Prices Drop?
Will declining mortgage rates cause home prices to rise?
Declining mortgage rates will likely incentivize would-be buyers anxious to own a home to jump into the market. Expect this increased demand amid today’s tight housing supply to put upward pressure on home prices.
forbes.com
forbes.com › advisor › mortgages › real estate
Housing Market Predictions For 2026: When Will Home Prices Drop?
What will happen if the housing market crashes?
If the housing market crashes, expect a rapid decline in home values, a rise in foreclosures and an oversupply of homes. However, most experts agree that a housing market crash in 2025 is unlikely, as many homeowners have built up significant home equity and housing stock is low. The issue is primarily an affordability crisis. High interest rates and inflated home values have made purchasing a home challenging for first-time home buyers.
forbes.com
forbes.com › advisor › mortgages › real estate
Housing Market Predictions For 2026: When Will Home Prices Drop?
Videos
Federal Reserve Bank of Chicago
chicagofed.org › publications › profitwise-news-and-views › 2018 › determinants-of-housing-values-and-variations-in-home-prices-across-neighborhoods-in-cook-county
Determinants of Housing Values and Variations in Home Prices Across Neighborhoods in Cook County - Federal Reserve Bank of Chicago
Since the recession, home prices in Cook County increased by 40 percent; however, home prices were still 10 percent below their peak in the county (in nominal terms). This slow recovery is driven by the deep and increasing disparities in income and socioeconomic conditions.
can someone explain what a recession does to the housing market?
Hard to predict because many different things could happen. Demand will likely go down, so that could bring home prices down. But if rates also come down, then home prices could stagnate or go up depending on demand. Inflation could also bring prices up and interest rates up, unless demand go down significantly. You could also see more investors using housing as a place to park investments, so that could make it difficult to buy entry level homes without cash on hand. Long story short, no one knows for sure. Save up for down payment. Build your credit score. Buy when the time is right for you and you feel comfortable. More on reddit.com
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April 15, 2025What would a recession do to real estate?
Houses will be cheaper but you will not be able to afford them if you or your partner lose your jobs. More on reddit.com
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November 30, 2024How do you think a likely recession will impact the housing market?
Based on what I have seen in my lifepan, prices will go up. More on reddit.com
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June 3, 2024Will this recession make both rates and housing prices decline significantly?
Just remember if a real recession and bear market hits, the odds that you stay in a home buying position drop dramatically. You may go from praying for a recession to being jobless and broke. Be careful what you wish for. More on reddit.com
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October 27, 2023WBEZ Chicago
wbez.org › housing › 2025 › 05 › 05 › chicago-housing-market-dampened-recession-fears-tariffs
Chicago’s housing market could be further dampened by recession fears and tariffs - WBEZ Chicago
May 6, 2025 - But tariffs can also have a recessionary impact if consumers pull back from spending because of higher prices, Zhao said. Depending on how tariffs impact the economy, it could influence the Federal Reserve to cut rates. Zhao said what happens depends on if the inflationary impact of tariffs is long or short term. If inflation isn’t temporary and the Fed doesn’t cut rates, the U.S. could see higher interest rates alongside a recession. “That’s a very bad situation for the housing market because it means that there’s not a lot of demand, because people are worried about their jobs and their finances,” Zhao said “But it also means that you don’t have the normal mortgage rate relief that you normally get in a recession to help stimulate the housing market.”
Griffin Funding
griffinfunding.com › home › mortgage › how does a recession affect the housing market?
How Does a Recession Affect the Housing Market? | Griffin Funding
July 14, 2025 - A recession usually slows the housing market due to lower buyer confidence and tighter lending rules. House prices during a recession can drop, but not evenly across all regions.
Houzeo
houzeo.com › home › seller › what happens to the housing market during a recession?
What Happens To The Housing Market During A Recession?
March 18, 2025 - During a recession, there are usually fewer buyers, so houses stay on the market longer. This encourages sellers to lower their listing prices to make their homes easier to sell. You might find it difficult to sell during this period.
U.S. GAO
gao.gov › blog › homeownership-during-recession
Homeownership During A Recession | U.S. GAO
... The cost of buying a home went up in all 9 cities following the Great Recession. Prices increased significantly in some cities (e.g., Denver, San Francisco, and Seattle) and to a lesser degree in others (e.g., Chicago and Cleveland).
Housingstudies
housingstudies.org › releases › cook-county-house-price-index-second-quarter-2024
Cook County House Price Index: Second Quarter 2024 - Home - Institute for Housing Studies - DePaul University
Therefore, this small recovery ... Lake View/Lincoln Park submarket was $1,418,000. House prices in Cook County have recovered by 109.4 percent from the bottom of the market....
The Mortgage Reports
themortgagereports.com › home › will interest rates go down in january? | predictions 2026
Will Interest Rates Go Down in January? | Predictions [current_year]
1 week ago - If inflation continues to dissipate and the economy cools or goes into a recession, it’s likely mortgage rates will decrease in 2026. Although, it’s important to remember that interest rates are notoriously volatile and are driven by many ...
Forbes Advisor
forbes.com › advisor › mortgages › real estate
Housing Market Predictions For 2026: When Will Home Prices Drop?
1 day ago - Slowing home price growth, rising inventory in some regions and modestly lower mortgage rates are giving buyers slightly more options and purchasing power. Despite these advantages, many potential buyers are still choosing to wait.
The Center Square
thecentersquare.com › illinois › article_5b16f851-84de-4570-9819-184125cb86a7.html
Survey: Homeowners concerned about housing market crash | Illinois | thecentersquare.com
April 17, 2025 - “Tariffs obviously, the federal government changes and cuts, just overall economic uncertainty and people seem pretty scared about what’s going on and for more homeowners, except for Gen-Z and younger homeowners, they all lived through the Great Recession and know what a housing crash looks like,” said researcher Nick Pisano.
National Association of REALTORS
nar.realtor › research-and-statistics › housing-statistics › existing-home-sales
Existing-Home Sales
3 weeks ago - With distressed property sales at historic lows and housing wealth at an all-time high, homeowners are in no rush to list their properties during the winter months." Read the full news release. See the summary of Existing Home Sales Statisticspdf (PDF: 232 KB) ... The Existing-Home Sales data measures sales and prices of existing single-family homes for the nation overall, and gives breakdowns for the West, Midwest, South, and Northeast regions of the country.
Bankrate
bankrate.com › real estate
Buying A House During A Recession | Bankrate
April 16, 2025 - This can lead to lower home prices. Lower rates: During a recession, the Federal Reserve will often lower interest rates to stimulate the economy. This can result in more favorable rates for borrowers getting mortgage loans.
Norada Real Estate
noradarealestate.com › home › what happens to house prices in a recession?
What Happens to House Prices in a Recession?
April 14, 2025 - As unemployment rises, fewer people are in a position to qualify for mortgages, leading to a decrease in demand for housing. This softening demand puts downward pressure on house prices in a recession.
GO Mortgage
gomortgage.com › home › blog › how recession impacts housing market | go mortgage
How Does a Recession Affect the Housing Market? A Strategic Opportunity for Buyers
September 30, 2025 - Falling home prices: When buyer demand cools, sellers may reduce prices to stay competitive. This gives buyers more negotiating power. Lower mortgage rates: Recessions usually bring down mortgage rates, as seen in 2020.
City Journal
city-journal.org › home › chicago’s hemorrhaging housing market
High Taxes and Government Debt Have Soured Chicago’s Housing Market
March 23, 2023 - One consequence of the lagging recovery is that Chicago has more homes with underwater mortgages—that is, the mortgage is greater than the value of the home—than any other major market. As many as 135,000 of these homeowners may risk default when the next recession hits and prices plummet again. Homeowners are feeling the pinch in other ways, too; local papers are filled with stories of people regretting their investment in a house.
Homebuyersofpittsburgh
homebuyersofpittsburgh.com › do house prices go down in a recession?
Do House Prices Go Down in a Recession?
July 22, 2024 - According to economic experts, home values will decline by 2-4%, which is the range by which property values often decline during recessions. Real estate prices are constantly determined by supply and demand.
GOBankingRates
gobankingrates.com › investing › real estate › worried about inflation? buy a home
Why Buying a Home Could Be the Smartest Way To Fight Inflation
4 weeks ago - High interest rates might not just make homes even more unaffordable — it might trigger a recession. In a recession, home prices typically fall, sometimes dramatically.
HomeLight
homelight.com › rise, fall, or stay level: what happens to house prices in a recession?
Rise, Fall, or Stay Level: What Happens to House Prices in a Recession?
March 31, 2024 - The inflated home prices and spike in subprime mortgages combined to trigger the biggest housing market crash in modern history. Unemployment spiked to 10% as of October 2009, and the GDP (gross national product) fell by more than 5%. “In ...
Investopedia
investopedia.com › investing › great-recessions-impact-housing-market
How the Great Recession Reshaped the Housing Market
November 17, 2025 - Mortgage rates may drop during a recession as the Fed works to stimulate growth in the housing market and economy. Consumers tend to spend less during a recession, so home prices may drop with demand.