That phrase has become a common way to describe the current housing market — one that in 2022 saw mortgage rates shoot up, buyers retreat and home sales drop off their once-feverish pace. They also bring up memories of the housing crash of the mid-2000s that led to the Great Recession. But today’s market is very different, and despite some dire predictions, a crash is far from certain.
A housing recession occurs when there is a slowdown in market activity; it’s usually characterized by a decline in housing starts and home sales and an increase in sales contract cancellations, among other factors. According to the National Association of Home Builders, the market has been contracting since last August.