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Past Recessions and Their Impact on the Housing Market Main Photo

Past Recessions and Their Impact on the Housing Market


Posted: September 23, 2019 by Tamara Foote

If you missed our monthly Real Estate Report video, Chairman and CEO, Bob Hamrick discusses our newest white paper which affirms that while another recession is probable, it's not entirely guaranteed. Increasing questions from apprehensive clients prompted us to create this in-depth report to analyze and historically chronicle past recessions and their impact on the housing market, both nationally and locally. Below, John McClelland, our vice president of research summarizes the report. 



Presently, media outlets have been pontificating on the outlook of the economy, most frequently with a "doomish" tilt. Many homeowners and those in the market for homes are asking us about our thoughts on the housing market as it relates to a potential economic slowdown. This is unsurprising as some leading indicators flashed warning signs and popular media amplifies fears of recession, almost as if commentators are collectively behaving like the rap battle hype man, encouraging a recession in a manner poignant and peremptory. This fulminating recession talk, combined with the scarred memories of those who lived through the housing crash makes questions about the future of housing expected.


We authored a white paper to examine several related themes:

1. Do indicators point to a recession?

2. Do home prices always react negatively to recessions?

3. What about the “trade war”?

First, we examine some popular leading indicators. Our general view is that a recession is probable but not guaranteed. Remember, it is notoriously difficult to forecast attributes of complex systems where quite periods are interrupted by seemingly spontaneous volatility. The indicators we look at seem to have predictive power but none can really tell us when. Our recommendation is to be cautious with leverage.

Second, housing tends to move in long cycles with multi-year trends that don’t necessarily correspond to recessions. Some recessions even had home prices trend higher. Local supply factors can mean much more than macroeconomic trends, even under reduced incomes.

Last, our investigation into the trade spat with China reveals a different narrative than that of much of popular media. Based on current figures, we believe that the impact on housing by tariffs are overblown.

John McClelland | Vice President, Research

Coldwell Banker Premier Realty






For all of the details and conclusions of our analysis, contact the agent responsible for sharing this blog post with you or download the full report by clicking here.

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