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Homebuyers are watching the economy closely, and for good reason.
Most Experts Are Not Worried About a Recession
What a Government Shutdown Really Means for the Housing Market
There’s been a lot of talk lately about how a government shutdown impacts the housing market. You might be wondering: Is it causing everything to grind to a halt?
The short answer? No.
The housing market doesn’t stop. It keeps moving. Homes are still being bought and sold, contracts are still being signed, and closings are still happening. The difference is that a few parts of the process may slow down a little, but overall, the market continues to function.
Here’s What Typically Happens
Whenever the government shuts down, some federal agencies temporarily close or scale back their operations. That can cause a few hiccups in real estate, especially when it comes to processing certain types of government loans and insurance requirements:
- “Applicants for FHA, VA, or USDA loans—which account for about one-quarter of all mortgage applications—may encounter significant processing delays due to agency furloughs.” – Selma Hepp, Chief Economist at Cotality
- “By recent estimates, more than 2,500 mortgage originations per working day are at risk of delays during a shutdown . . .” – Zillow
- Flood insurance approvals may also be paused. The National Flood Insurance Program can be temporarily affected, which delays closings in flood zones.
Even with those challenges and delays, most transactions still go through. Buyers keep buying, sellers keep selling, and agents keep helping people move forward.
The Housing Market Usually Bounces Back Fast
And you can see that play out in this data. If you look back at the most recent government shutdown that began at the end of 2018 and lasted for 35 days, sales activity dipped very slightly during the closure but picked right back up once the government reopened.
Data from the National Association of Realtors (NAR) shows existing home sales slowed for about two months, and then rebounded quickly as delayed closings worked their way through the system when the government reopened (see graph below):
What’s important to note is that the slowdown you see in the orange bars on this graph wasn’t simply due to seasonality in a typical housing market cycle. The sharper, shorter drop in this case lines up exactly with the 35-day government shutdown, and then sales bounced back as soon as it ended.
What This Means for You
If you’re in the middle of buying or selling a home, don’t panic. Most deals will still move forward, even if it takes a few extra days. Jeff Ostrowski, Housing Market Analyst at Bankrate, explains:
“If you’re expecting to close in a week or a month, there could be some slight delay, but I think for most people, it’s probably going to be a blip more than a real deal killer.”
And if you’re just starting to think about buying or selling, this could actually work in your favor. Some buyers and sellers may become cautious and pause their plans during times of uncertainty, like this, and that can open a short window of opportunity.
When fewer people are active in the market, well-prepared buyers may find less competition for homes, and motivated sellers may be more willing to negotiate. These brief slowdowns often create a moment where you can make a move that would be harder once activity ramps back up.
Bottom Line
A government shutdown can cause short-term delays for some buyers, but it doesn’t derail the housing market. The last time this happened, sales picked back up as soon as the government re-opened.
If you’re unsure how this might affect your plans, or just want to make sense of what’s happening, connect with a local real estate agent.
Is the Housing Market Going To Crash? Here’s What Experts Say
If you’ve seen headlines or social posts calling for a housing crash, it’s easy to wonder if home values are about to take a hit. But here’s the simple truth.
The data doesn’t point to a crash. It points to slow, continued growth.
And sure, it’s going to vary by local area. Some markets will see prices rise more than others. And some may even see small, short-term declines. But the big picture is: home prices are expected to rise nationally, not fall, over the next 5 years.
The Real Story Is in the Expert Forecasts
In the Home Price Expectations Survey (HPES) from Fannie Mae, each quarter over 100 leading housing market experts weigh in on where they project home prices will go from here. And in the report that was just released, the experts agree prices are projected to climb nationally through at least 2029 (see graph below):
Here’s how to read this visual. Each bar in that graph shows an increase, not a loss. It’s just that the anticipated pace of that appreciation varies year-to-year.
And to further drive this home, let’s look at another view of where prices are and where they’re expected to go. In this version, the expert forecasts are broken into 3 categories: the overall average, the most optimistic projections, and the most pessimistic projections (see chart below):
Notice how even the most pessimistic forecasters say we’ll see prices rise by almost 5% over the next few years.
- Overall, prices are expected to rise about 15% from now through the end of 2029.
- The optimists say we’ll beat that and see a roughly 26% increase.
- And even the pessimists anticipate prices will go up by 5% during that period.
What sticks out the most? None of these groups who study the market are forecasting a crash, or even a decline, over the next 5 years.
How This Compares to “Normal” for the Market
Now, focus back on the first graph. The projections call for 2-3.5% price increases in each of the next five years. For context, the average rate of appreciation for the last 25 years was closer to 4-5% annually.
So, while that’s slightly below the historical average, it’s much more sustainable and typical than where the market was in 2020, 2021, and 2022.
Back then, prices rose too much, too fast based on record-low supply and record-high demand. Some places even saw prices climb by 15-20%.
So, while it may feel like prices are stalling compared to those pandemic-era surges, what’s really happening is that the market is finally finding balance again.
Why Prices Aren’t Expected To Crash
A lot of the chatter about home prices today is based on that rapid rise and the old saying that what goes up, must come down. But historically, that’s not really true. Home prices almost always rise.
And the main reason we’re not heading for a repeat of 2008 is simple: supply and demand.
Even though affordability challenges have made it harder for some people to buy over the past few years, there still aren’t enough homes for everyone who wants one. And that ongoing shortage is keeping upward pressure on prices nationally.
That’s why experts across the board can confidently agree: we’re not headed for a price collapse, but for steady, long-term appreciation.
And just in case it’s the economy that’s got you worried, remember this. Over the past 50 years, there have been plenty of economic events that have impacted the market. And one thing that’s consistently been true throughout time is the housing market always recovers. And we’re coming through that turn right now and going into a recovery.
Bottom Line
If you’ve been waiting to buy or sell because you’re worried about a crash, it’s time to look at the data – not the headlines.
The question isn’t if home prices will rise, it’s by how much.
Connect with an agent who can show you what’s happening in your local market and what these forecasts mean for your next move.
Why Experts Say Mortgage Rates Should Ease Over the Next Year
You want mortgage rates to fall – and they’ve started to. But is it going to last? And how low will they go?
Experts say there’s room for rates to come down even more over the next year. And one of the leading indicators to watch is the 10-year treasury yield. Here’s why.
The Link Between Mortgage Rates and the 10-Year Treasury Yield
For over 50 years, the 30-year fixed mortgage rate has closely followed the movement of the 10-year treasury yield, which is a widely watched benchmark for long-term interest rates (see graph below):
When the treasury yield climbs, mortgage rates tend to follow. And when the yield falls, mortgage rates typically come down.
It’s been a predictable pattern for over 50 years. So predictable, that there’s a number experts consider normal for the gap between the two. It’s known as the spread, and it usually averages about 1.76 percentage points, or what you sometimes hear as 176 basis points.
The Spread Is Shrinking
Over the past couple of years, though, that spread has been much wider than normal. Why? Think of the spread as a measure of fear in the market. When there’s lingering uncertainty in the economy, the gap widens beyond its usual norm. That’s one of the reasons why mortgage rates have been unusually high over the past few years.
But here’s a sign for optimism. Even though there’s still some lingering uncertainty related to the economy, that spread is starting to shrink as the path forward is becoming clearer (see graph below):
And that opens the door for mortgage rates to come down even more. As a recent article from Redfin explains:
“A lower mortgage spread equals lower mortgage rates. If the spread continues to decline, mortgage rates could fall more than they already have.”
The 10-Year Treasury Yield Is Expected To Decline
It’s not just the spread, though. The 10-year treasury yield itself is also forecast to come down in the months ahead. So, when you combine a lower yield with a narrowing spread, you have two key forces potentially pushing mortgage rates down going into next year.
This long-term relationship is a big reason why you see experts currently projecting mortgage rates will ease, with a fringe possibility they’ll hit the upper 5s toward the end of next year.
Here’s how it works. Take the 10-year treasury yield, which is sitting at about 4.09% at the time this article is being written, and then add the average spread of 1.76%. From there, you’d expect mortgage rates to be around 5.85% (see graph below):
But remember, all of that can change as the economy shifts. And know for certain that there will be ups and downs along the way.
How these dynamics play out will depend on where the economy, the job market, inflation, and more go from here. But the 2026 outlook is currently expected to be a gradual mortgage rate decline. And as of now, things are starting to move in the right direction.
Bottom Line
Keeping up with all of these shifts can feel overwhelming. That’s why having an experienced agent or lender on your side matters. They’ll do the heavy lifting for you.
If you want real-time updates on mortgage rates, reach out to a trusted agent or lender who can keep you in the loop and help you plan your next move.
What a Fed Rate Cut Could Mean for Mortgage Rates
The Federal Reserve (the Fed) meets this week, and expectations are high that they’ll cut the Federal Funds Rate. But does that mean mortgage rates will drop? Let’s clear up the confusion.
The Fed Doesn’t Directly Set Mortgage Rates
Right now, all eyes are on the Fed. Most economists expect they’ll cut the Federal Funds Rate at their mid-September meeting to try to head off a potential recession.
According to the CME FedWatch Tool, markets are already betting on it. There’s virtually a 100% chance of a September cut. And based on what we know now, there’s about a 92% chance it’ll be a small cut (25 basis points) and an 8% chance it will be a bigger cut (50 basis points):
So, what exactly is the Federal Funds Rate? It’s the short-term interest rate banks charge each other. It impacts borrowing costs across the economy, but it’s not the same thing as mortgage rates. Still, the Fed’s actions can shape the direction mortgage rates take next.
Why Markets Already Saw This Cut Coming
Here’s the part that may surprise you. Mortgage rates tend to respond to what the financial markets think the Fed will do, before the Fed officially acts. Basically, when markets anticipate a Fed cut, that outlook gets priced into mortgage rates ahead of time.
That’s exactly what happened after weaker-than-expected jobs reports on August 1 and September 5. Each time, mortgage rates ticked down as financial markets grew more confident a cut was coming soon. And even though inflation rose slightly in the latest CPI report, the Fed is still expected to make a cut.
So, if the Fed goes with a 25-basis point cut, as expected, that’s likely already baked in to current mortgage rates, and we may not see a dramatic drop.
But if they go bigger and drop their Federal Funds Rate by 50 basis points instead, mortgage rates could come down more than they already have.
So, Where Do Mortgage Rates Go from Here?
While the upcoming cut may not move the needle much, many experts expect the Fed could cut the Federal Funds Rate more than once before the end of the year. Of course, that’s if the economy continues to cool (see graph below):
As Sam Williamson, Senior Economist at First American, explains:
“For mortgage rates, investor confidence in a forthcoming rate-cutting cycle could help push borrowing costs lower in the back half of 2025, offering some relief to housing affordability and potentially helping to boost buyer demand and overall market activity.”
If multiple rate cuts happen, or even if markets just believe they will, mortgage rates could ease further in the months ahead. But here’s the catch – all of this depends on how the economy evolves. Surprise inflation data or unexpected shifts could quickly change the outlook.
Bottom Line
Mortgage rates likely won’t drop sharply overnight, and they won’t mirror the Fed’s moves one-for-one. But if the Fed begins a rate-cutting cycle, and markets continue to expect it, mortgage rates could trend lower later this year and into 2026.
If you’ve been waiting and watching the housing market, now’s the time to talk strategy. Even small changes in rates can make a meaningful difference in affordability, and understanding what’s ahead helps you make the best decision for your situation.
Mortgage Rates Just Saw Their Biggest Drop in a Year
You’ve been waiting for what feels like forever for mortgage rates to finally budge. And last week, they did – in a big way.
On Friday, September 5th, the average 30-year fixed mortgage rate fell to the lowest level since October 2024. It was the biggest one-day decline in over a year.
What Sparked the Drop?
According to Mortgage News Daily, this was a reaction to the August jobs report, which came out weaker-than-expected for a second month in a row. That sent signals across the financial markets, and then mortgage rates came down as a result.
Basically, we’re seeing signs the economy may be slowing down, and as certainty grows in the direction the economy is going, the markets are reacting to what is likely ahead. That historically brings mortgage rates down.
Why Buyers Should Pay Attention Now
But this isn’t just about one day of headlines or one report. It’s about what the drop means for you.
This recent change saves you money when you buy a home. The chart below shows you an example of what a monthly mortgage payment (principal and interest) would be at 7% (where mortgage rates were in May) versus where rates roughly are now:
Compared to just 4 months ago, your future monthly payment would be almost $200 less per month. That’s close to $2,400 a year in savings.
How Long Will It Last?
That really depends on where the economy and inflation go from here. Rates could drop lower, or they could inch up slightly.
So, make sure you’re connected with a good agent and trusted lender. They’ll keep a close eye on inflation indicators, job market updates, and reactions to upcoming Fed policy to gauge where mortgage rates may go from here.
But for now, focus on this. While no one can say for sure where rates are headed, the fact that rates broke out of their months-long rut is a good thing. If you’ve been feeling stuck, this could make the start of a new chapter. As Diana Olick, Senior Real Estate and Climate Correspondent at CNBC, says:
“Rates are finally breaking out of the high 6% range, where they’ve been stuck for months.”
And that’s gives you more reason to hope than you’ve had in quite some time.
Bottom Line
This is the shift you’ve been waiting for.
Mortgage rates just saw their biggest decline in over a year. And if rates stay near this level, it could make a home you couldn’t afford just a few months ago feel possible again.
What would today’s rates save you on your future monthly payment? Connect with an agent or lender so you can find out.
What Mortgage Delinquencies Tell Us About the Future of Foreclosures
You may be seeing headlines about how foreclosures are rising. And if that makes you nervous that we’re headed for another crash, here’s what you should know.
According to ATTOM, during the housing crash, over nine million people went through some sort of distressed sale (2007-2011). Last year, there were just over 300,000.
So, even with the increase lately, we’re talking about numbers that are dramatically lower. But what does the future hold? Is a wave coming? The short answer is, no.
Here’s why. Experts in the industry look at mortgage delinquencies (loans that are more than 30 days past due) as an early sign for potential foreclosures down the line. And the latest data for delinquencies is reassuring about the market overall.
Right now, delinquencies as a whole are consistent with where we ended last year, which means we’re not seeing the kind of increase that would signal widespread trouble.
But there are some key indicators to continue to watch. Marina Walsh, Vice President of Industry Analysis at the Mortgage Bankers Association, explains:
“While overall mortgage delinquencies are relatively flat compared to last year, the composition has changed.”
Right now, borrowers with FHA mortgages currently make up the biggest share of new delinquencies (see graph below):
And here’s why that may be happening. Borrowers with FHA mortgages may be more sensitive to shifts in the economy. And with recession fears, stubborn inflation, employment challenges, and more, it makes sense this segment of the market may be feeling it a bit more. But that doesn’t mean it’s a signal a crash is coming.
If you look back at the graph, it shows, while there are more FHA loans experiencing hardship than the norm, delinquency rates for other loan types remain low and stable. Back during the crash, delinquency rates were significantly elevated for all 4 categories.
That means the broader mortgage market is on much stronger footing than it was back in 2008. As ResiClub says:
“The recent uptick in mortgage delinquency seems to be concentrated among FHA borrowers, however, mortgage performance remains very solid when viewed in light of the twenty-year history of our data.”
The Region with the Most FHA Loans
Here’s another reason this isn’t a signal of trouble ahead. FHA loans only make up about 12% of all home loans nationwide. But like anything else in housing, local data matters. There are some regions of the country where there are more of this type of loan than others, particularly the South.
The map below does not show how many FHA loans are delinquent. It just shows the overall concentration of FHA loans by state, so you can see which regions have the greatest volume (see map below):
As the Federal Reserve Bank of New York explains:
“Looking at geographic concentrations of loans, recent data indicate that a higher proportion of mortgage balances are delinquent in many of the southern states . . . we see that higher delinquency rates coincide with a higher share of FHA loans across states.”
Just remember, even the delinquencies rates we’re seeing now aren’t as high as they were in 2008. Again, this is not a signal of a crisis. But it is something experts will monitor in the months ahead.
If You’re Experiencing Financial Hardship
No one wants to see anyone face the challenges of foreclosure. But just know that, if you’re a homeowner struggling with payments, you’re not alone – and you do have options.
The first step is reaching out to your mortgage provider. In many cases, you may be able to set up a repayment plan or explore loan modifications to help you stay on track. And for many homeowners today, you may also have enough equity to sell your house and avoid foreclosure. Odds are, at least some of these delinquencies will go that route since homeowners today have near record amounts of equity in their homes. It may be worth seeing if that could be an option for you too.
Bottom Line
Foreclosures are rising slightly, but they’re nowhere near the levels of 2008. And delinquency trends don’t point to a crash ahead.
This is something industry professionals are going to watch in the days ahead. If you want to stay up to date, connect with an agent or lender so you always have the latest information.
History Shows the Housing Market Always Recovers
Now that the market is slowing down, homeowners who haven’t sold at the price they were hoping for are increasingly pulling their homes off the market. According to the latest data from Realtor.com, the number of homeowners taking their homes off the market is up 38% since the start of this year and 48% since the same time last June. For every 100 new listings in June, about 21 homes were taken off the market.
And if you’ve made that same choice, you’re probably frustrated things didn’t go the way you wanted. It’s hard when you feel like the market isn’t working with you. But while slowdowns can be painful in the moment, history tells us they don’t last forever.
History Repeats Itself: Proof from the Past
This isn’t the first time the housing market has experienced a slowdown. Here are some other notable times when home sales dropped significantly:
- 1980s: When mortgage rates climbed past 18%, buyers stopped cold. Sales crawled for years. But as soon as rates came down, sales surged back, and the market found its footing again.
- 2008: The Great Financial Crisis was one of the toughest housing downturns in history. Sales and prices both dropped hard. Still, sales rebounded once the economy recovered.
- 2020: During COVID, sales disappeared overnight, and many people had to put their plans on hold. Yet the recovery was faster than anyone expected, with a surge of buyers re-entering the market as soon as restrictions eased.
The lesson is clear: no matter the cause, the market always rebounds.
Today’s Situation: Where We Stand Now
Over the past few years, home sales have been sluggish. And one big reason why is affordability. Mortgage rates rose at a record-breaking pace in 2022, and home prices were climbing at the same time. That combination put buying out of reach for many people. And when demand slows, home sales do too.
The Outlook: Why Things Will Improve
But here’s the encouraging part. Forecasts show sales are expected to pick up again moving into 2026.
Last year, just about 4 million homes sold (shown in gray in the graph below). And this year is looking very similar (shown in blue). But the average of the latest forecasts from Fannie Mae, the Mortgage Bankers Association (MBA), and the National Association of Realtors (NAR) show the experts believe there will be around 4.6 million home sales in 2026 (shown in green).
And a big reason behind that projection is the expectation that mortgage rates will come down a bit, making it easier for more buyers to jump back in.
That means what’s happening now is part of a cycle we’ve seen before. Every slowdown in the past has eventually given way to more activity, and this one will too.
Just like the 1980s, 2008, and 2020, today’s dip in home sales is temporary.
What That Means for You
If you’ve paused your moving plans, you did what you thought was right. Your frustration is valid. But it’s also important to remember the bigger picture. Housing slowdowns don’t last forever.
That’s where your local real estate agent comes in. Their job is to keep a close eye on the market for you. When the first signs of a rebound appear, they’ll help you spot the shift early so you can relist with confidence.
Bottom Line
If today’s housing market feels stuck, remember it’s never stayed down for good. Slowdowns end, activity returns, and people get moving again. So, connect with a local real estate agent, because when the next wave of buyers shows up, you won’t want to miss it.
As activity picks up again, will you be ready to put your house back on the market, or do you need to move sooner?
Think It’s Better To Wait for a Recession Before You Move? Think Again.
Fear of a recession is back in the headlines. And if you’re thinking about buying or selling sometime soon, that may leave you wondering if you should reconsider the timing of your move.
A recent survey by John Burns Research and Consulting (JBREC) and Keeping Current Matters (KCM) shows 68% of people are delaying plans to buy or sell due to economic uncertainty.
But it may not be for the reason you think. Not everyone is holding off because they’re worried. Some buyers are waiting because they’re hopeful. According to Realtor.com:
“In 2025Q1, 3 in 10 (29.8% of) surveyed homebuyers said a recession would make them at least somewhat more likely to purchase a home . . . This reflects a common dynamic where some buyers see a downturn as an opportunity. If the economy enters a recession, the Federal Reserve may respond by lowering interest rates to stimulate activity, potentially putting downward pressure on mortgage rates and easing affordability concerns. As a result, buyers—especially those with limited down payments—might view a recession as a more favorable time to enter the market.”
And there’s some truth to the idea that a recession could bring about lower mortgage rates. History shows mortgage rates usually drop during economic slowdowns. That’s not guaranteed – but it is a common pattern. Looking at data from the last six recessions, you can see mortgage rates fell each time (see graph below):
But here’s what those buyers may not be considering. Many of those hopeful buyers are assuming something else will happen too – that home prices will drop. And that’s where history tells a different story.
According to data from Cotality (formerly CoreLogic), home prices went up in four of the last six recessions (see graph below)
So, while many people think that if a recession hits, home prices will fall like they did in 2008, that was an exception, not the rule. It was the only time the market saw such a steep drop in prices. And it hasn’t happened since, mainly because there’s still a long-standing inventory deficit, even as the number of homes on the market is rising.
Since prices tend to stay on whatever path they’re already on, know this: prices are still holding steady or rising in most metros, although at a much slower pace. So, a big drop isn’t likely. As Robert Frick, Corporate Economist with Navy Federal Credit Union, explains:
“Hopes that an economic slowdown will depress housing prices are wishful thinking at this point . . .”
Bottom Line
If you’ve been waiting for a recession to make your move, it’s important to understand what really happens during one – and what likely won’t. Lower mortgage rates could be on the table. But lower home prices? That’s far less likely.
Don’t wait for a market that may never come. If you’re thinking about buying or selling, connect with an agent to talk through what today’s economy really means for you – and make a smart plan that works in your favor, regardless of what the headlines say.
Why Buying Real Estate Is Still the Best Long-Term Investment
Lately, it feels like every headline about the housing market comes with a side of doubt. Are prices going up or down? Are we headed for a crash? Will rates ever come down? And all the media noise may leave you wondering: does it really make sense to buy a home right now?
But here’s one thing that doesn’t get enough airtime. Real estate has always been about the long game. And when you look at the big picture, not just the latest clickbait headlines, it’s easy to see why so many people say it’s still the best investment you can make – even now.
According to the just-released annual report from Gallup, real estate has been voted the best long-term investment for the 12th year in a row. That’s over a decade of beating out stocks, gold, and bonds as America’s top pick.
And this isn’t new. Real estate usually claims the #1 title. But here’s what’s really interesting. This year’s results came in just after a rocky April for the stock and bond markets. It shows that, even as other investments had wild swings, real estate has held its ground. That’s likely because it gains value in a steadier, more predictable way. As Gallup explains:
“Amid volatility in the stock and bond markets in April, Americans’ preference for stocks as the best long-term investment has declined. Gold has gained in appeal, while real estate remains the top choice for the 12th consecutive year.”
That says a lot. Even though things may feel a bit uncertain in today’s economy, real estate can still be a powerful investment.
Yes, home values are rising at a more moderate pace right now. And sure, in some markets, prices may be flat in the year ahead or even dip a little – but that’s just the short-term view. Don’t let that cloud the bigger picture.
Real estate has a long track record of gaining value over time. That’s the kind of growth you can count on, especially if you plan to live in that home for a long time.
That’s part of why Americans continue to buy-in to homeownership – even when the headlines may sound a little uncertain. As Sam Williamson, Senior Economist at First American, says:
“A home is more than just a place to live—it’s often a family’s most valuable financial asset and a cornerstone to building long-term wealth.”
Bottom Line
Real estate isn’t about overnight wins. It’s about long-term gains. So, don’t let the uncertainty in a shifting market make you think it’s a bad time to buy.
If you’re feeling unsure, just remember: Americans have consistently said real estate is the best long-term investment you can make. And if you want more information about why so many people think homeownership is worth it, reach out to a local real estate agent.