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History Shows the Housing Market Always Bounces Back

Dated: August 27 2025

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Now that the market is slowing down, homeowners who haven’t sold their homes at the desired price are increasingly removing them from the market. According to the latest data from Realtor.com, the number of homeowners taking their homes off the market has increased by 38% since the beginning of this year and by 48% since the same time last June. For every 100 new listings in June, approximately 21 homes were removed from the market.
If you’ve made the same decision, you’re likely feeling frustrated that things didn’t turn out as you had hoped. It’s challenging when you feel like the market isn’t working in your favor. However, while slowdowns can be painful in the moment, history suggests that they don’t persist indefinitely.
History Repeats Itself: Evidence from the PastThis isn’t the first time the housing market has experienced a slowdown. Here are some notable instances when home sales significantly declined:
1980s: When mortgage rates surged above 18%, buyers halted their purchases. Sales stagnated for years. However, as soon as rates decreased, sales rebounded, and the market regained its footing.2008: The Great Financial Crisis was one of the most severe housing downturns in history. Sales and prices plummeted significantly. Nevertheless, sales rebounded once the economy recovered.2020: During the COVID-19 pandemic, sales plummeted overnight, and many individuals had to postpone their plans. Nevertheless, the recovery was faster than anticipated, with a surge of buyers re-entering the market as soon as restrictions eased.
The lesson is clear: regardless of the cause, the market always recovers.
Current Situation: Our Current StandOver the past few years, home sales have been sluggish. One significant factor contributing to this is affordability. Mortgage rates reached unprecedented heights in 2022, while home prices simultaneously increased. This combination made homeownership unattainable for many individuals. Consequently, when demand decreases, home sales also decline.
Outlook: Why Things Will ImproveHowever, there’s a positive note. Forecasts indicate that sales are expected to rebound in the coming years, particularly in 2026.
Last year, approximately 4 million homes were sold, as indicated by the gray color in the graph below. This year’s trend appears similar, as shown in the blue color. However, the latest forecasts from Fannie Mae, the Mortgage Bankers Association (MBA), and the National Association of Realtors (NAR) suggest that experts anticipate around 4.6 million home sales in 2026, as depicted in the green color.
A significant factor contributing to this projection is the anticipated decrease in mortgage rates, which will make it more accessible for a larger number of buyers to re-enter the market.
It’s important to recognize that the current situation is part of a recurring cycle. Every slowdown in the past has eventually led to increased activity, and this one will follow suit.
Similar to the 1980s, 2008, and 2020, today’s dip in home sales is temporary.
What This Means for YouIf you’ve paused your moving plans, it was the prudent decision. Your frustration is understandable. However, it’s crucial to maintain a broader perspective. Housing slowdowns are not permanent.
In such situations, your local real estate agent becomes invaluable. Their primary responsibility is to closely monitor the market for your benefit. When the initial signs of a rebound emerge, they will assist you in identifying the shift early, allowing you to relist with confidence.
In conclusion, if today’s housing market appears stagnant, remember that it has never remained in a state of decline indefinitely. Slowdowns eventually subside, activity resumes, and people begin moving again. Therefore, it’s advisable to connect with a local real estate agent. When the next wave of buyers materializes, you won’t want to miss out on this opportunity.
As activity picks up, will you be prepared to put your house back on the market, or do you need to move sooner?
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Kristen Haynes

Kristen Haynes is a true Entrepreneur with over 10 years of real estate experience and a 6 figure agent after her first year selling residential real estate in 2013. After being a top producing agent ....

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