Prepare for the Housing Recession Ahead

This dog has your back in the Recession

A housing recession can get pretty nasty (sort of like stepping in dog poop) for homeowners and potential buyers alike. As the real estate market deteriorates it’s crucial to adopt proactive measures to protect your home investment and financial well-being. In this dog post, we’ll delve into strategies to keep you out of the dog house and navigate the coming housing recession.

For Current Homeowners Evaluate Your Mortgage Situation:

Begin by reviewing your mortgage terms and conditions. If you have a high interest rate on a home loan that is under water ( the loan is bigger than the asset it is secured by). Explore options for mortgage relief programs and communicate with your lender about potential modifications or forbearance plans in case you face difficulties meeting your mortgage payments during the recession. Also keep an eye on the news to see if you may qualify for any government programs which come down the pipe. These government people just can’t help themselves (old dogs don’t learn new tricks).

If Possible Build and Maintain an Emergency Fund:

My dad use to mix an egg into my food. Not anymore. Inflation has been crushing everyone in the United States. Cut your costs where you can and prepare. The other reason to stock cash away right now is that there will be amazing opportunities in the real estate market as well as the economy in general. Cash is always king so take your rightful spot on the throne.

Reassess Your Home’s Value and Equity:

The ATM is closed for awhile. Homeowners are going to have a hard time getting money out of their homes for awhile. Property is an illiquid asset. Homeowners have once again forgotten that the housing is an asset that takes time to turn into cash unlike stocks or T-bills. If you have been paying on your 15 or 30 yr mortgage for 10 to 15 years without pulling money out take a breathe, you’ll be fine. For homebuyers in the last 5 years you may lose equity in your home in the short term. This situation will become very fluid in the next 12 months

Protect Your Credit Score:

When the market crashes prices get very reasonable. Don’t fail to jump on life changing opportunities because you missed a credit card payment. The biggest issue regarding credit scores (outside of paying for basic goods and services) is going to be around paying for medical bills. In this Thunderdome part of our economy negotiate everything upfront (if possible). Medical providers will try to stick you with major bills which already account for ~ 2/3 of bankruptcies in America.

Explore Property Tax Relief Programs:

Some regions offer property tax relief programs during economic downturns. Research local initiatives and determine whether you qualify for any tax reductions or deferrals. These programs can alleviate the financial strain of home ownership during challenging economic periods.

Diversify Investments and Assets:

Airbnb hosts probably aren’t going to be seeing all of that passive income that they have seen over the last few years in a recessionary period. Blue Chip companies will likely be trading at major discounts. Gain a better understanding of what goes into the Q’s & K’s (those are 10-Q’s & 10-K’s) that companies file. There will amazing opportunities for those who look, know how to look and most importantly know where to look.

Be Mindful of Market Trends:

Stay informed. I could add more here but this is the most important detail. If you do find yourself needing to buy or sell a property during this period it is crucial that you find a well informed, seasoned realtor who want just sell hype and fair dust. A great realtor in a market downturn will likely have to tell clients from time to time this probably is the right opportunity for you. As always Tango is here to help keep you out of the dog house and put you in the penthouse. As always feel free to reach out if you have any questions or need any assistance.

#WOOF