Santa Barbara Real Estate

More than a Third of Homebuyers Think a Recession is Coming!

The once red-hot California housing sales market is officially now “weak” state analysts say. In a brief report issued by the state Legislative Analyst’s Office weighed in on the latest California home sales that trends are notably lower than historic norms. Home sales were on a clear downward trend during the second half of 2018 and the beginning of 2019.

The anticipation of a recession in itself could make the housing shortage even worse. Worried would-be sellers may decide to postpone listing until they can get top dollar for their properties.

Yet although a lack of homes for sale typically drives up prices, that effect could be mitigated if there are fewer folks who can afford to buy. In a recession, it could become harder to find a good-paying job or steady freelance work. Even those who remain gainfully employed may worry about their job stability.

Home prices may have just peaked. It could be a sign that a recession is looming on the horizon. In April, median U.S. home values fell 0.1% to $226,800 from $227,000 in March, according to Zillow the first month-to-month decline in seven years. That’s bad news for homeowners thinking of selling. Researchers at the Federal Reserve pointed out that a housing downturn has proceeded every U.S. recession since the 1950s.

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Mark Danforth Lomas

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