Economic headlines can be unsettling—especially when they mention a potential slowdown or recession. For homeowners and buyers alike, the natural question is: What does this mean for home prices and mortgage rates?

The truth is, history tells a more balanced story than many fear.

A Recession Doesn’t Automatically Mean Falling Home Prices

The housing crash of 2008 left a lasting impression. But that period was unique—driven by risky lending practices, an oversupply of homes, and a financial crisis that directly targeted real estate.

Looking back at the last six U.S. recessions:

• Home prices rose in four of them.
  
  
• In the few instances where prices dipped, the changes were modest compared to 2008.
  
  

Why? Inventory. Even when the economy slows, the number of available homes plays a major role in price direction. Today, in most areas, housing supply remains below historical norms—helping to keep prices relatively steady.

Mortgage Rates Often Decline in Slowdowns

While home prices tend to follow their existing trend, mortgage rates often move in the opposite direction of economic activity. Historically, interest rates have fallen during recessions, which can:

• Increase buying power for those entering the market.
  
  
• Provide refinancing opportunities for existing homeowners.
  
  

It’s worth noting that while rates may dip, the ultra-low levels of the early 2020s were historically rare.

Why This Matters for Buyers and Sellers

• For buyers: An economic slowdown could bring rate relief, creating an opening to enter the market with lower borrowing costs.
  
  
• For sellers: Low inventory combined with steady demand can keep your home’s value strong, even in a softer economy.
  
  

The Bottom Line

Economic slowdowns don’t automatically translate to a housing market crash. By looking at decades of data, one thing is clear: housing tends to be more resilient than most people expect.

If you want to understand what’s happening in your local market—and how national trends may impact you—connect with a trusted real estate professional who can put the data into perspective.