A Recession Doesn’t Automatically Mean Home Prices Will Drop

💡 Let’s Clear Something Up...

Just because we’re hearing the word recession doesn’t mean we’re heading for a housing crash.

In fact, in 4 out of the last 6 U.S. recessions, home prices actually went up. And in one of them, prices dipped by less than 2%.
The only outlier? 2008—which was a very specific storm of risky lending, overbuilding, and a financial system on shaky ground.


So What Usually Happens?

✨ Home prices tend to stay steady or cool off slowly—not collapse.
👥 There may be fewer buyers jumping in, but that doesn’t mean prices fall.
📍And every local market is different. It all depends on how many homes are available and how many people are looking.

🌸 Mortgage Rates Often Dip During a Recession

Here’s a little silver lining—mortgage rates usually go down in a recession.

According to Freddie Mac, in every one of the last 6 U.S. recessions, rates dropped. That’s because the Fed often lowers interest rates to help the economy recover, which can make home loans more affordable.

Will we see those dreamy 3% rates again? Probably not. But even a small drop can make a big difference in your monthly payment.



💖 Today’s Homeowners Are in a Really Strong Spot

One major difference between now and 2008?
Equity.

Most homeowners have built up years of equity thanks to steady price growth.

According to Realtor.com’s analysis:

  • Even with a 10% price drop, homeowners would still hold about 70% equity, similar to 2021.

  • A 20% drop? That just brings us back to 2019 levels.

  • Plus, 54% of homeowners have mortgage rates under 4%, meaning they’re in no rush to sell.

That all adds up to a very different market—not one flooded with distressed sales.

💬 Let’s Wrap It Up

Recessions can feel a little unsettling—but here’s what history shows us:

✨ Home prices usually hold strong
💰 Mortgage rates tend to drop
🏠 Homeowners are more financially secure than ever

If you're feeling unsure about what all this means for your real estate plans, I’m here to help. Let's talk through it together and figure out what makes the most sense for you—not just what the headlines are saying.

jennifer Sloan