Recently, after a long period of high home prices and high mortgage rates, there has been a predicted shift in the housing market. It is foreseen that there could be a substantial drop in housing prices in the future spurring a reinvigoration of the housing market, which has been on the decline since the height of covid in 2020. Mark Zandi, Moody's chief economist, had stated in interviews the direction in which the housing market would need to continue to get back to relatively normal price ranges as compared to pre covid. Zandi stated "I don't expect the housing market to come roaring back here, certainly not in 2024," he said. "Probably won't be until 2025, 2026 before we see sales levels that are more consistent with what we've enjoyed historically." However, there are a few with more optimistic views on the future of the housing market.
Redfin CEO Glenn Kelman believes that the housing market is already reigniting. Stating that the amount of housing inventory has already begun to increase. He mentioned that more homes were being listed and those not sold are being listed again at lower prices. He ends with the observation that prices that had originally frozen the housing market are now being pried open and buying and selling will continue to increase as the year progresses.
Cited Source
https://markets.businessinsider.com/news/commodities/home-prices-housing-market-forecast-zandi-kelman-mortgage-affordability-rates-2023-11
The title of your post alone makes me excited! I like the fact that houses are dropping in prices but does that include interest rates too? It is crazy how much our economy changes and how many factors are involved (kinda mind blowing)!
ReplyDeleteIt is interesting that over the past 3 months we have been doing these blogs someone picks to talk about the housing market and it has been changing and the predictions are changing also. I will be interested in seeing where the housing market will be at the beginning of the new year then in 2025/2026.
Overall, in order to fix this housing market, more houses need to be built in order to offset these insane interest rates. Hopefully by the time we are out of school and potential homebuyers our purchasing power will be way higher...
ReplyDeleteThis is exciting news that the prices of houses are dropping. How will they go about fixing the market after it falls? As the buying and selling of houses increases I wonder if this will help the market fix itself.
ReplyDeleteWe have been working on the housing market for our data newsletter and so far all signs have been pointing to awful. Prices are high, inventory is low, and mortgages applications are at record breaking lows. From what we found, an increase in inventory is the answer to all of our housing problems, so to hear that some change may be coming is delightful, especially for us future house owners.
ReplyDeleteGreat information! I have the Case-Shiller Index for my variable in the newsletters, so I am consistently looking at this information. Although home prices have not gone down as of August, the increase in home prices month to month has significantly decreased. From almost 1% in July to .43% in August. In my opinion this is signaling a recession.
ReplyDeleteWe have been facing a low inventory in the housing market, especially after the pandemic and also as a reflect of the 2008 crisis. An increase in inventory would help offset the challenges in home affordability. However, building new houses is something that does not have an immediate effect, since construction can take months/years.
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