How Would a Recession Impact Homebuyer Decisions?
With tariffs, an ongoing housing shortage, and elevated home prices, 2025 is off to a rocky start. And with talk of a potential recession, some would-be homebuyers are rethinking whether or not it’s a good time to enter the market. According to a recent survey from real estate marketing platform Realtor.com, 63.4% of U.S. homebuyers in the first quarter of 2025 said they expect a recession within a year. This marks the third-highest level of concern on the topic since 2019.
How do recessions impact homebuyers’ decisions?
Homebuyers differ in their concerns about a potential recession, with some seeing it as an opportunity to buy at a lower price point. In the first quarter of 2025, 29.8% of surveyed buyers said a recession would make them at least somewhat more likely to purchase a home, while 15.8% said they've be less likely to buy if a recession hits.
Meanwhile, 54.4% said a recession would have no impact on their purchasing decisions. According to the report, this group may have greater financial security or could be motivated by lifestyle decisions rather than market factors.
A recession isn’t the only thing buyers are worried about
While a potential recession is top of mind for some homebuyers, many are focused on other pressing concerns. Limited housing inventory was a leading issue in the first quarter of 2025, with 44.3% of buyers reporting that they were unable to find a home that suited their needs.
Budget constraints were another major area of concern, cited by 36% of surveyed buyers. Additionally, 8.2% of buyers expressed concerns about qualifying for a mortgage, while 13.5% were concerned about poor credit scores.
Homebuyers have been expressing concerns about the economy throughout the year
- Homebuyer Sentiment Down in April 2025: In April, just 23% of surveyed buyers said they believe it is a good time to buy a home.
- Consumer Housing Market Sentiment Falters: March 2025 marked the first year-over-year decline in housing market optimism in two years.