Is it smart to buy during a recession?
By Advantage Property | 16th Jun 20
The experts agree that buying a house during a recession can result in scoring a great value on a home that may have been out of your reach during better economic times. But if you want to buy during a recession, you need to have:
- Stable employment
- Savings as a safety net
- Time to do your research
If buyers can tick all of these boxes, there’s no better time to buy than during a recession. So what are the Pros?
- The first obvious pro to buying a house during a recession is that housing prices are lower, so buyers can afford to purchase homes that may have been out of reach for them before.
- The second pro is of course there is often less competition. Investors tend to leave a stressed market and this segment of the market will decide to wait and see what happens. For some this will be due to employment stability and for others it will be confidence in understanding property cycles.
- Another pro is that Mortgage rates are also likely to be lower during a recession, so buyers get the benefit of both a low interest rate and lower purchase price.
- Lastly you as the buyer have the negotiation power often to be able to request your desired settlement terms, perhaps some special inclusions such as fitted TV’s or an outdoor BBQ. These might seem like small things but they can be a nice cherry on top of a successful purchase.