Real Estate Prices Are About To Take A DIVE — See How
(TargetLiberty.org) – There could be good news on the way if you’re planning to relocate or upsize your home. After years of high property prices, demand is finally falling, and that means prices should soon fall as well.
Home-price growth downshifted in May, posting a 19.7% annual gain compared with a 20.6% increase in March and a 20.4% jump in April.https://t.co/cmCLT9Al9D
— HousingWire (@HousingWire) July 26, 2022
On July 26, economist Ian Shepherdson warned clients at financial consultants Pantheon Macroeconomics that US real estate values are set to crash in the near future. Shepherdson said single-family home listings are up 40% over the last three months, but sales are falling fast — down by 8.1% in June alone, and they’re now at their lowest since 2020. He estimates US home prices are overvalued by 15-20% and said they “have to adjust to the downside, likely quite substantially.”
Inflation is probably a factor in declining sales; with Americans struggling to buy gas and food, moving into a new home isn’t a priority for many people right now. Another definite factor is rising interest rates. The Federal Reserve has just increased interest rates by another 0.75%, marking the second such rise in two months. Most analysts expect another rise to come in September. Mortgages are now more expensive, creating a big disincentive for people who already feel the pressure on their budgets. Mortgage applications are also at a 22-year low, and refinance applications have fallen by 80% in a year. Another rate rise will cut demand even more.
Copyright 2022, TargetLiberty.org