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October 14, 2022

Mortgage Rates and Recessions – 60 years

Today I want to talk about mortgages and the history of the Real Estate Market. There are two keys to real estate history. The first key is Mortgage Rates and the second key is Housing Prices. Several recessions have occurred and you’ll be surprised to learn typical trends in real estate during recessions.

Mortgage Rates Over the Past 60 Years

Mortgages and Recessions have a consistent relationship over many decades. This chart came from a very educational blog write up from Mortgage Specialists in Omaha, Nebraska. You can see that while over the past 50 years, mortgage rates rollercoastered quite a bit, in each recession rates actually dropped after they rose. Keep this in mind as your stay in touch with your mortgage professional because they know exactly what is happening day in and day out while they continuously price out loans. If you find yourself in a recession, make wise plans for your future with educated decisions based on history.

Housing Prices and Recessions over the past 60 years.

The Economy is much more elaborate than I can explain. Don’t confuse The Economy with home values. You can see in this chart from Mortgage Specialists that over the course of 60 years, home values have stayed even or appreciated during every recession

In fact, on a broader scale, Home values have stayed flat or even increased over the past 100 years. 

Although “inflation value” comes into play with economics, the actual value of homes consistently increases, and even with inflation, home values are a great way to keep up with inflation. A realtor friend here in Colorado Springs, Colorado, explained it to me like this once: “Housing values are like a buoy in the ocean. The swells and tide may rise and fall (inflation) but the buoy (house) stays consistent with that rise and fall.

Knowing the Risks of Homeownership

Remember that buying a home is a great path to financial success and/or relief, but it is a long term game. Many people lost big in the 2008 mortgage meltdown for many reasons, including the get rich quick mentality of short term buying and selling as home values truly skyrocketed. Many laws came into existence in America because of predatory lending during that time. Remember that whatever your situation there is a Juicy Solution waiting for you and my team is excellent at honestly taking care of you wherever you are at. I have many other blog posts and resources as well, so be sure to take a peak around the website for more helpful tips.


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