Episode 18: And Now You Know With REALTOR Ro: Coming Recession??

Episode 18: And Now You Know With REALTOR Ro:  Coming Recession??

(upbeat bright music) – Hey there, thanks for
clicking on this week’s segment of, And Now You
Know With REALTOR Ro. So I am on vacation,
but I did wanna jump on to take a few minutes
to talk about something that we have all been
hearing an awful lot about. And a lot of people
don’t want to talk about, and that is rumors of a coming recession. First of all, it is not
something that is actually agreed upon by many economists. And so you should be taking
that with a grain of salt. But the bigger point is,
that even if there is a recession, it is not going
to be like the Great Recession, it is not going to affect
the housing industry. So people are becoming very
guarded about buying a home or investing in real estate,
because of what happened back about 13 years ago. And so just to review, any
of the previous recessions that we have had, they have
not affected housing prices like the last one, the reason
that the Great Recession, which is of course,
very fresh in our minds, did have that kind of effect. That was because of the fact that we had, lots of subprime mortgages
and inflated prices that really weren’t based in fact. So right now we have housing
prices that are going up, but they are going up
because of limited inventory, and so because of that we are not looking at the housing market being affected, if there indeed is a recession. So you really shouldn’t
let that scare you. And if you look at
historically, the recessions that we have had, over the last 40 years, you’ll see that even with a recession, that housing prices were never affected, even by on average it was 2.7%
that they would be affected. So in that case, you look
at the Great Recession, and you’ll see that on average,
housing price were affected by something like nearly 17%. And the Great Recession lasted 19 months. But the recession before
that, that lasted the longest in ’80 and ’81, only lasted about, or did last actually, 17
months, but housing prices were still only affected by about 6%. So just keep that in
mind when you’re looking at just what an anomaly
the Great Recession was. And once again, although it is something that affected this country
on such a large scale, and so it’s a good thing to
keep those things in mind, but you have to remember that
it has been something that, it was a lesson that was learned. And so you do have much
tighter lending standards, you don’t have the
subprime mortgage market like we did then. And instead you look at,
right now the bottom 10% of current mortgage
holders, their low score is averaging at 649, now
back when the Great Recession took place, that low score was
602, that’s a big difference. And so those are just some
of the things to look at, some indicators to think about. So if you are thinking about jumping into the housing market, then
you shouldn’t be scared off by the rumors that are out
there about a coming recession. If you have any other
questions, give me a call, I can also connect you with
some wonderful mortgage bankers who are gonna know even
more about this than I do. But I did just wanna jump
on and let you know that, right now we have historic lows, and I hate to see people
missing out on that. Pardon me, I mean when
you have mortgage rates that are lower than 4%
and you’re not getting into the market because of those fears, I just thought maybe, somebody needed to go ahead and talk about it. So I hope that you did learn something and that you can share it with others. And if you follow me
on Instagram, Twitter, YouTube or Facebook, you’ll
be notified the next time that I post a segment of, And
Now You Know With REALTOR Ro. Enjoy your day, bye bye. (bright upbeat music)

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