According to economists surveyed by the Wall Street Journal, they think there’s a 28% chance of a recession within the next year. This figure, by the way, is up from last year’s prediction of a 13% chance of a recession.
If you don’t think that your clients and potential clients are worried about a coming recession, did you know:
In a recent CNBC poll, “81% [of U.S. adults] say they are concerned the U.S. will face a recession in 2022.”
So, what will you say to your clients and potential clients when they express hesitancy to jump into the real estate market because they’ve read there’s a recession coming?
Here are some pointers to keep their confidence high.
Real Estate Times Series is shown above. See more, Click Here.
Can’t fault the housing market this time
Economists state that it won’t be a faltering housing market that causes the possible 2022 or 2023 recession. Instead, if it happens, they expect it to be triggered by the Fed’s efforts to curb it.
Those efforts to get prices under control come with a risk: “… the central bank will do too much, sinking the economy in the process,” according to Matt Egan at CNN.com.
Economists point to the differences between the market in 2008 and today. Think back to the Great Recession. That housing bubble, economists agree, was caused by the easy access to mortgages.
Today’s market is influenced by supply and demand and, “… this time around, household finances are stronger and home values remain at historic highs,” claims Alcynna Lloyd at BusinessInsider.com.
So, how does this knowledge calm your clients’ nerves?
According to experts, there will be no housing bubble to explode in their faces. Therefore, remind them that anyone with a heartbeat could get a mortgage prior to the Great Recession. Today, lending rules are much more stringent, leading to far more qualified buyers looking for homes.
Finally, not all recessions are like the recession of 2008 and a recession doesn’t automatically equal a housing crisis.
Homeowners have nothing to worry about
If a recession comes to pass, homeowners should ride it out quite well.
They’re also sitting on a ton of equity right now – equity that isn’t likely to dissipate during the forecasted recession.
Huh?
During the five recessions prior to the 2008 recession, home prices actually increased.
Overall, the jobs market is so strong right now that a recession is unlikely to impact home prices and, thus, values.
If we listen to the experts, your clients have nothing to worry about when it comes to the real estate market. Don’t let them buy into the media hype and you’ll keep them in the market.
PLUS: When you have time…below are some marketing tools to help support your success.
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