Key Takeaways: Experts Predict No Housing Market Crash Despite High Mortgage Rates and Rising Home Prices
Are we headed for a housing market crash? That’s the question on the minds of many potential homebuyers as they watch property prices continue to rise despite high mortgage rates. The lack of housing supply is to blame for this trend, according to experts in the field. Economists predict that any market correction will be modest and not on the scale of the Great Recession. So, what does this mean for the future of the housing market?
In April, existing-home prices were up 5.7 percent over the previous year, marking the 10th consecutive month of year-over-year increases. The S&P CoreLogic Case-Shiller home price index also hit a new high in March, up 6.5 percent from the previous year. Despite the high prices, experts do not expect a housing market crash due to low inventory levels and strict lending standards.
The lack of housing supply is a major factor driving the rise in home prices. With only a 3.5-month supply of homes on the market, buyers are facing stiff competition and bidding wars. Builders have been cautious about ramping up construction since the Great Recession, leading to an ongoing shortage of homes for sale.
While mortgage rates have increased, experts believe that any market correction will be modest. The strong demand for homes, coupled with low inventory levels, is expected to keep prices stable. In fact, many economists believe that the housing market will not crash at all, citing factors such as low inventory, strict lending standards, and demographic trends as reasons for continued stability.
So, if you’re in the market for a new home, don’t let the high prices and mortgage rates deter you. Despite the current challenges, the housing market is expected to remain strong in the coming months. And with no housing market crash on the horizon, now might be a good time to make your move.
Disclaimer: The information provided in this article is for informational purposes only and should not be considered as financial advice. The content is based on general research and may not be accurate, reliable, or up-to-date. Before making any financial decisions, it is recommended to consult with a professional financial advisor or conduct thorough research to verify the accuracy of the information presented. The author and publisher disclaim any liability for any financial losses or damages incurred as a result of relying on the information provided in this article. Readers are encouraged to independently verify the facts and information before making any financial decisions.