Nearly 30% of Home Shoppers Say a Recession Would Make Them More Likely to Buy

 

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More than 6 in 10 buyers expect a recession in the next year. And yet, nearly 1 in 3 say that would make them more likely to buy a home.

In the first quarter of 2025, economic anxiety hit one of its highest points since the pandemic. The stock market’s been volatile, tariffs are back in the headlines, and no one knows what the Fed will do next.

The full Q1 2025 Site Visitor Survey from Realtor.com reveals where buyers stand right now:

• What’s holding them back
• What’s driving them forward, and
• What agents should be doing in response
• 
  

The data shows a market shaped by uncertainty, but not retreat. Read on for the biggest takeaways from the report.

Recession Concerns Are High

A majority of home shoppers—63.4%—expect the U.S. to hit a recession within the next 12 months.

That level of concern is the third highest since 2019, following a peak of 78% in Q2 2020 and sustained concern through 2022 and early 2023, when bank failures and aggressive rate hikes dominated the news cycle.

But while headlines are rattling consumer confidence, not everyone is hitting pause. Here’s what buyers said about how a recession would impact their plans:

• 29.8% said a recession would make them more likely to buy a home.
• 54.4% said it would have no impact on their decision.
• Only 15.8% said they would be less likely to purchase.
• 
  

Why? For many buyers, the opportunity to buy during a slowdown, with less competition and potentially lower rates, outweighs the broader uncertainty.

According to Danielle Hale, Chief Economist at Realtor.com®:

“Confidence in the economy has clearly taken a hit amid ongoing headlines around trade, tariffs, and rate uncertainty… 

“But while concerns are definitely present, some buyers anticipate that a downturn can bring opportunity. Well-prepared buyers who have been waiting on the sidelines are likely motivated by personal and lifestyle needs like growing families, new jobs, or retirements and these considerations can outweigh short term economic uncertainties.”

What’s Actually Holding Buyers Back

While economic concerns are shaping buyer behavior, the biggest barriers aren’t emotional; they’re practical. The top three reasons buyers are struggling to move forward all come down to inventory, affordability, and financing challenges:

1. Lack of inventory that fits their needs (44.3%)
   • Despite some improvement in listing activity, total inventory is still 16.3% below pre-2020 norms, limiting options across many markets.

2. Budget constraints (36%)
   • Inflation, higher interest rates, and tariff-driven price increases are squeezing buyer budgets, especially for those with less flexibility.

3. Credit and financing issues
   • 13.5% cited poor credit scores.
   • 8.2% said they were unable to qualify for a mortgage.
   • Tighter lending standards, higher rejection rates, and looming student loan credit changes are adding pressure to the loan process.

The Federal Reserve Bank of New York reported in February that more consumers now expect higher difficulty and rejection rates when applying for credit.

Realtor.com notes that up to 9 million student loan borrowers may experience credit score declines this year—another factor that could affect loan eligibility for first-time and younger buyers.

A Less Competitive Market Means New Opportunities

Even with these challenges, one area is clearly improving: competition.

In Q1 2025, just 7.7% of buyers identified overbidding as a top concern, down from 10.4% a year ago. Maybe Barbara Corcoran’s advice is getting around.

Homes are spending more time on market, and prices are stabilizing. As a result, buyers are gaining more negotiation power and facing less pressure than in the frenzied post-pandemic years.

For serious buyers—and the agents working with them—this shift could be a key window of opportunity.

Key Takeaways for Real Estate Agents

The data paints a clear picture: yes, buyers are worried about the economy. But many are still planning to buy. And the ones who are ready to act may be more serious than ever.

Here are four key insights to keep in mind:

• Use recession concerns as a conversation starter, not a stopper. Acknowledge the fear, then offer clear options and context.
• Position lower competition as a buyer advantage. Help clients understand that today’s market offers more leverage than they might realize.
• Get ahead of financing hurdles. Partner with lenders early to help clients overcome credit issues and loan challenges.
• Focus on life-driven buyers. Many shoppers are motivated by major life changes, not just rates or headlines. Tailor your messaging to those deeper needs.

While the headlines focus on fear, the full story is a lot more nuanced and presents real opportunity for those who are ready.

Build trust by helping your clients see clearly whether now is the time to move or to lay the groundwork for a better outcome.

Then be ready to provide exactly what they need from you.

 Key Details: 

• According to Realtor.com’s Q1 2025 Site Visitor Survey, 63.4% of home shoppers expect a recession within the next year, yet nearly 30% say it would make them more likely to buy. 
• The report also found that 44.3% of buyers are struggling to find suitable inventory, while just 7.7% cited overbidding as a concern, down from 10.4% last year.

Sarah Lentz | May 21, 2025 | Housing Market

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