This is NOT 2008
A Recession does NOT equal a housing crisis
Today’s market conditions are far from when housing was a key factor that triggered a recession. This is NOT 2008!
1] There’s no dysfunction in the banking system ;
2] There are few households who are over-leveraged with their mortgage payment;
3] There are no easy-access mortgages,
4] There is no skyrocketing home price appreciation.
We’re not where we were 12 years ago. None of those factors are in play today.
Look at the past five recessions in U.S. history. Home values actually appreciated in three of them. It is correct that they sank by almost 20% in 2008, but 2008 presented different circumstances.
In the four previous recessions, home values depreciated only once – and by less than 2%.
In the other three, residential real estate values increased by 3.5%, 6.1%, and 6.6%
That said, concerns about a recession are real. But we can be confident that, while we don’t know the exact impact the virus will have on the housing market, we do know that housing isn’t the driver.