5 Reasons Why the Housing Market Will Remain Stable Despite Recession Fears

The United States has been in the midst of an economic expansion for more than a decade. However, recent stock market volatility and increasing recession fears have led to concerns about a housing market crash.

Here are five reasons why these fears may be overblown, and why the housing market is expected to remain stable:

1. Robust Real Estate Demand

Despite the potential for a recession, underlying buyer demand for homes remains strong. Demographics, including the millennial generation entering their home-buying years, is expected to continue to push demand up.
Furthermore, the historically low interest rates will make homeownership more affordable, creating a healthy amount of real estate demand.

2. Tight Inventory

Another factor that's supporting a healthy housing market is the tight inventory of homes for sale. There are not enough homes on the market to meet demand, leading to bidding wars and a seller's market.
With housing inventory as low as it is, if the recession does hit, any decline in demand is expected to be well absorbed.

3. Stable Interest Rates

Interest rates have been low for many years now, and although they have been recently rising, they remain at historic lows.
The Federal Reserve has given many indications that it will continue to keep interest rates low, which could help the housing market to remain stable during any recession.

4. Conservative Lending Standards

In the years following the 2008 financial crisis, the mortgage industry underwent a great deal of scrutiny and implemented stricter lending standards.
Most homebuyers who get approved for a loan have robust credit ratings and are less likely to default on their mortgages.

5. Job Market Strength

Lastly, a strong job market can help keep the housing market steady. Lower unemployment rates mean more people can pay their mortgages and remain in their homes.
Over time, this stability makes for a healthy real estate market that’s able to weather any upcoming recession.

Conclusion: A Stable Housing Market Is Likely

In conclusion, while there's always some amount of risk that comes along with any kind of economic turmoil, the housing market is expected to continue to remain stable in the coming years. With strong real estate demand, low inventory, conservative lending standards, and a strong job market, homeowners and investors alike should feel confident that their real estate investments are safe.
Check out our new blog for more insights on Why There Won’t Be a Recession That Tanks the Housing Market.

Location: Chicago, IL 60602, USA

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