What can be a result of real estate investment during a recession?

Decreased property values and demand often occur during a recession due to several interconnected economic factors. During a recession, consumer confidence tends to decline, leading to reduced spending and investment. As people become more cautious about their financial stability, many may delay purchasing homes or even consider selling existing properties, which negatively impacts demand.

Furthermore, lenders may tighten their credit requirements, making it more difficult for potential buyers to secure financing. This decreased availability of loans further contributes to a lowered demand for real estate. As a result, property values may also decrease because sellers often have to lower their prices to attract buyers in a market with less competition.

In summary, both decreased property values and diminished demand for real estate are common outcomes during periods of economic recession, making this choice the most accurate in the context of real estate investment during such times.