A Recession? Let's not Wag the Dog

By
Real Estate Broker/Owner with ViewHomes of Clark County - Nature As Neighbors
https://activerain.com/droplet/5kRR

If you’re worried about a recession having a negative impact on the real estate market in Clark County, think again.

 

Who can predict a Recession?  

 

First of all, no one knows for certain when a recession will hit. Regardless of what you’re hearing from media outlets, there is no economic data or research that suggests we can look 12 months into the future and predict a recession.  

 

It makes one wonder why we keep hearing the R-word tossed about in such a cavalier manner. Sadly, it’s become somewhat standard in our country to use fear and speculation to report the news.

 



Do you remember the 1997 movie, Wag the Dog?  If not, it’s about a spin doctor, who prior to an election, fabricates a war to cover up a Presidential sex scandal. There are suggestions that there’s some wagging going on right now. 

 

Regardless, let’s stick to something I (Debb) used when working as a radio newswoman in Portland, facts and common sense. What a concept! 

 

Just the Facts Ma’am 

 

Whether a recession comes in a year, two years, or ten years, it’s not likely to have much of an impact on our local housing market.  


Fact: Since 1980 there have been five official recessions in the U.S. Aside, from the Great Recession ( 2007-2009), inflation adjusted housing prices only declined 2.7 percent from the month before the recession began to the final month, according to the home price index data from Robert Shiller. 

 

Fact: The 2008 recession, which was an anomaly, didn’t cause the housing market to plummet into chaos, the plummeting housing market caused the recession. 

 

     Contributing factors to the housing market freefall included:

 

            Lenders issuing expensive, high-risk mortgages designed to fail.  

 

            A glut of new construction inventory, causing prices to drop rapidly. 

 

            Homeowners defaulting on loans and homes going into foreclosure. 

 

Fact: The next recession, if and when it comes, will be a natural end to economic expansion that has been going on since 2008. In other words, it is likely to be a pretty standard downturn and has nothing to do with mortgages and the housing market. 

 

Fact: The current housing market is almost opposite of what it was in 2008 - tight mortgage credit, not loose, and housing supply shortages instead of a surplus. 

 

Fact: The local real estate market is healthy. Inventory remains tight, at 2.3 months, which means it takes that period of time to sell all of the current inventory. A balanced market is 6 months of inventory.   Bottom line:It remains a strong sellers market in Clark County, Washington. 

 

 

Finally, let’s use some common sense.

Historically, as far as home prices dropping in the wake of a recession, 2008 was the exception. During two mild recessions in the early 1980’s, home prices increased, just as they did in the early 2000s. 

 

It's unnecessary to be manipulated, don’t let unsubstantiated rumors and fear mongering prevent you from moving ahead and living life. Look at the facts and use common sense. 

 

Want to sell a home?  It’s the perfect time

Want to buy a home? It’s the perfect time. 


This is an entry into the September Challenge hosted by Debe Maxwell, CRS

 

 

Posted by

 

ViewHomes™ grew out of our passion for nature, beautiful surroundings, and peaceful environments. Starting together in an urban environment, over the years we've gravitated towards areas with smaller populations and less density. We now enjoy our lifestyle in a rural environment, but with close proximity to metropolitan areas where we appreciate all the amenities of fine restaurants, shopping, and an easy drive to an international airport.
Living in ViewHomes™ is like having “elbowroom for the soul”.

 

360-608-4900 

info@natureasneighbors.com
 

                                                                             

 

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Rainer
526,547
Sham Reddy CRS
H E R Realty, Dayton, OH - Dayton, OH
CRS

That's the truth! Nobody knows!

It makes one wonder why we keep hearing the R-word tossed about in such a cavalier manner. Sadly, it’s become somewhat standard in our country to use fear and speculation to report the news.

 

Sep 28, 2019 01:57 PM #35
Ambassador
1,868,680
Debb Janes EcoBroker and Bernie Stea JD
ViewHomes of Clark County - Nature As Neighbors - Camas, WA
REALTORS® in Clark County, WA

Hey Sham Reddy CRS - you got it. Nobody knows.  ( On a side note, I've been a follower of yours, but noticed I wasn't - what? Fixed it, let's hope it stays this time) 

Sep 28, 2019 02:07 PM #36
Rainmaker
5,425,106
Roy Kelley
Realty Group Referrals - Gaithersburg, MD

I am not worried about a recession. I spent the afternoon photographing dahlias.

Sep 28, 2019 03:30 PM #37
Ambassador
1,868,680
Debb Janes EcoBroker and Bernie Stea JD
ViewHomes of Clark County - Nature As Neighbors - Camas, WA
REALTORS® in Clark County, WA

As well you should, Roy. ;) 

Sep 28, 2019 03:56 PM #38
Ambassador
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Margaret Rome, Baltimore Maryland
HomeRome Realty 410-530-2400 - Pikesville, MD
Sell Your Home With Margaret Rome

Good to read your entry Debb Janes EcoBroker and Bernie Stea JD ... And my favorite line:  

Regardless, let’s stick to something I (Debb) used when working as a radio newswoman in Portland, facts and common sense. What a concept! 

Sep 28, 2019 06:30 PM #39
Ambassador
3,112,611
Paul S. Henderson, REALTOR®, CRS
RE/MAX Northwest. - Tacoma, WA
Tacoma Washington Agent/Broker & Market Authority!

 I did not read one false statement in your whole post and agree with you 100% Debb Janes EcoBroker and Bernie Stea JD 

Sep 28, 2019 07:10 PM #40
Rainmaker
3,133,625
Nina Hollander
Coldwell Banker Residential Brokerage - Charlotte, NC
Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor

Great post, Debb... I often feel as if people are running around like chickens with their heads cut off spouting stuff and not really understand what it is that they are spouting!

Sep 28, 2019 11:19 PM #41
Rainer
134,838
Adam Feinberg
ANCHOR ASSOCIATES - Manhattan, NY
NYC Condo, Co-op, and Townhouse specialist

I have a very strong track record of predicting signficant changes in the markets- but I had a long career on Wall Street before recently becoming an agent. The environment had changed, I was tired of the politics and insane hours and intense stress working for others.  Yes, recessions will come, and we will survive. That said, we often see some short term concerns associated with fear, layoffs, and vastly reduced bonuses but it doesn't typically last long.

We are heading toward an intentional recession with the trade war, but we can also change direction in a single day and put a halt to the damage being done. That is what makes predicting this market so very different than viewing typical economic trends. I never agreed with Larry Kudlow, and think it's unfortunate that I may be proven right about the path he is advising the White House to take. This is an instance where I actually want to be proven wrong.

 

All real estate is local, and local markets will react differently to economic events- even if when smoothed in a national context the data can show a different result.

Sep 28, 2019 11:35 PM #42
Rainmaker
1,329,198
Carol Williams
Although I'm retired, I love sharing my knowledge and learning from other real estate industry professionals. - Wenatchee, WA
Retired Agent / Broker / Property Manager

Hi Debb,
In my humble opinion the R talk is strictly a political ploy... which is extremely sad and, frankly, makes me angry. 

Sep 29, 2019 09:36 AM #43
Rainmaker
624,646
MaryKay Shumway
The Kellstrom Ray Agency, Inc. (Est. 1948) - Sister Bay, WI
Door County Wisconsin's Real Estate Expert

Very nice breakdown of what has happened with our national economy in the past nearly 40 years!  This is great information to share....and share again!

Sep 29, 2019 10:30 AM #44
Rainmaker
3,021,733
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of the Manchester NH's area Leading Agents

The media and half the politicians sure look like they are routing for one. On the ground here in Real EState there is no signs of one. People buying, people selling, massive amounts of new jobs bringing people here to NH Debb Janes EcoBroker and Bernie Stea JD 

Sep 29, 2019 11:10 AM #45
Rainmaker
1,544,033
Marte Cliff
Marte Cliff Copywriting - Priest River, ID
Your real estate writer

What the "news" media is reporting today only serves to prove that Chicken Little is alive and well.

Sep 29, 2019 09:20 PM #46
Rainmaker
1,543,950
Lyn Sims
RE/MAX Suburban - Schaumburg, IL
Schaumburg IL Real Estate

I see the same thing in my market. All you can do is prove with the numbers or trends what is going on. Great post!

Oct 03, 2019 11:08 AM #47
Ambassador
3,355,078
Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

Facts & common sense seem to be a thing of the past in when it comes to the media, Debb! I hate it too - I used to love the news and really looked forward to hearing what was going on locally, in our nation and the world. Now, sadly, it's only really opinionism with no real substance and certainly not what we were raised to understand as journalism.

Thank you so much for your entry in September's challenge. Great research and wonderful thoughts - certainly worthy of a gold star too!

Oct 03, 2019 08:24 PM #48
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