Sometimes you have to sell your home even when the market is down.
As a result, you will be faced with an important question. Can you sell your house during a recession? The answer isn’t quite as bad as you might be tempted to think.
Do Housing Prices Fall During Recessions?
If you’re forced to sell your home, all is not lost. You will probably still find a buyer even if the economy is poor.
According to research from Bay Area Market Reports, with the exception of the 2008 financial crash which impacted mostly real estate, housing prices usually see declines of only 10% to 11% during normal recessions.
That’s not a bad drop in value at all. For context, just as recently as 2022, the stock market saw a 20% drop overnight.
This means that you’re very likely not going to see too much of a loss if you sell your home during a normal recession. However, there still might be a few outlier events.
How To Sell Before A Recession Hits
There is a slight “trick” to selling your home before a recession hits. Simply sell your home when you notice a downtrend in housing prices.
That’s because research shows that housing prices are more likely to drop before a recession hits, not after. By the time you’re in a recession, there’s a good chance your house’s value will have already been dropping for some time.
Pay attention to the housing market. When you see a downturn, you might have to bail.
Should You Sell Your Home During A Recession
If you have the resources to survive, should you sell your home during a recession? The answer is no.
History is perfectly clear. You should keep your real estate if you can. There are always better options to weather the storm.
In a public news report, CNBC confirmed that after studying housing prices over the last 100 years, they found that housing prices have always outperformed inflation.
In fact, the rise in value was so substantial they declared that buying a home is “an escalator to wealth.”
So don’t throw away your house too quickly when something goes wrong.
How To Beat A Recession When It Hits
One way to avoid losing value from your home is to turn it into a rental property.
The evidence is clear on this. We’ve written before how rental prices don’t drop during a recession.
If you’re desperately in need of money, renting your home to someone else who is in need may be the “out” you need to avoid losing your property.
We Have A Tool For You
Learning to beat economic downturns is one of the main reasons we developed RentalPropertyCalculator.net. We’ve designed a tool to help anyone be able to turn their real estate property into a thriving investment.
Check it out. See if it’s the kind of investment that’s right for you.