Home Prices Escape Recession Unscathed

Abstract

Six months into the deepest recession since the 1930s, home prices continue to rise across the nation. According to the Federal Housing Finance Agency, average home prices were 1.9 percent higher in the third quarter than the first quarter of 2020, with prices rising in 360 of the 384 metropolitan statistical areas tracked. Although home prices react differently during recessions, widespread increases are rare. Temporary factors specific to the COVID-19 pandemic, including a low supply of homes for sale, have supported prices in recent months. However, four fundamental factors are expected to boost home prices for the next several years, which are explored in this On Point.

Authors

Dan Grantham