What Happens to Home Prices During a Recession—And What It Means for Salt Lake & Park City Buyers and Sellers

What Happens to Home Prices During a Recession—And What It Means for Salt Lake & Park City Buyers and Sellers. Here’s What a Recession Could Mean for the Housing Market

Worried about how a recession might affect home values in Salt Lake City or Park City, Utah? You’re not alone. It’s a question I get often: “Do home prices crash during a recession?” The truth is, history tells a more nuanced story.

While economic downturns can slow price growth or shift market momentum, home values don’t always drop—and in some cases, they even rise. In high-demand markets like Salt Lake and Park City, the combination of limited inventory, strong job sectors, and long-term desirability often helps stabilize property values, even during national recessions.

Whether you’re planning to buy, sell, or simply want to understand what a potential economic shift could mean for your investment, this post will break down the historical data, local trends, and what you should be watching right now.

Recession talk is all over the news, and the odds of a recession are rising this year. And that leaves people wondering what would happen to the housing market if we do go into a recession.

Let’s take a look at some historical data to show what’s happened in housing for each recession going all the way back to the 1980s.

A Recession Doesn’t Mean Home Prices Will Fall

Many people think that if a recession hits, home prices will fall like they did in 2008. But that was an exception, not the rule. It was the only time we saw such a steep drop in prices. And it hasn’t happened since.

In fact, according to data from CoreLogic, in four of the last six recessions, home prices actually went up (see graph below):

So, if you’re thinking about buying or selling a home, don’t assume a recession will lead to a crash in home prices. The data simply doesn’t support that idea. Instead, home prices usually follow whatever trajectory they’re already on. And right now, nationally, home prices are still rising at a more normal pace.

Mortgage Rates Typically Decline During Recessions

While home prices tend to stay on their current path, mortgage rates usually drop during economic slowdowns. Again, looking at data from the last six recessions, mortgage rates fell each time (see graph below):

So, a recession means mortgage rates could decline based on the data. While that would help with affordability, don’t expect the return of a 3% rate.

Bottom Line

The answer to the recession question is still unknown, but the odds have gone up. But that doesn’t mean you have to wonder about the impact on the housing market – historical data tells us what usually happens.

Understanding how recessions impact real estate is key to making smart, confident decisions—especially in a unique market like Utah. I can walk you through the local data, help you interpret national trends, and build a plan tailored to your goals, whether you’re buying, selling, or just exploring your options.

When you hear talk about a possible recession, what concerns or questions come to mind about buying or selling a home? Want to Talk Strategy? I’m Here to Help. schedule a strategy session here. Let’s make sure you’re positioned to succeed—no matter what the market brings.