Housing prices rose 20.6% year-on-year in March 2022, marking the largest increase in 30-year record keeping, according to Joint Center for Housing Studies tabs from data from CoStar and CoreLogic Case- Shiller Home Price Index.
Rental prices have also skyrocketed, further widening the wealth gap between landlords and tenants in the United States and making home ownership beyond the reach of nearly four million Americans a year. past. According to Harvard researchers, the annual income needed to qualify for an average-priced home has increased by $ 28,000 since last year.
But things may change soon. With a growing number of potential buyers closing out of the market, “sellers will eventually see the need to accept a lower price for their property,” said senior real estate economist Matthew Pointon. Despite growing pressure on the housing market, the mortgage rate has risen more than 6%, which could indicate that housing prices are likely to start falling.
Capital Economics forecasts a 5% drop in house prices in 2023, followed by a “gradual recovery” to 3% in 2024. As the real estate market slows, real estate companies have begun to lay off by the hundreds of workers as they anticipate a fall and a fall. in the purchase of housing.
Related: Accessibility (or lack thereof) in the current housing market
However, with ongoing supply chain constraints, inflation, and Fed initiatives to keep it under control, house prices remain high. And if the economy goes into recession, researchers warn that rising prices for individuals off property would turn “the recent rise in housing insecurity into a wave.”
Related: How to Save the Dying American Dream from Home Ownership