Yeah but??? WTH
This week, Zandi let Fortune know that Moody’s Analytics was downgrading its initial forecast. Over the coming year, Zandi now predicts U.S. house prices will shift somewhere between 0% to -5%. Heading into June, Moody’s Analytics expected U.S. house prices to remain unchanged over the coming year.
If a recession hits, Moody’s Analytics expects those 183 significantly overvalued regional housing markets to decline by -15% to -20%.
I am waiting for this to happen.
…markets like Boise (overvalued by 72%), Charlotte (overvalued by 66%), and Austin (overvalued by 61%).
Nice try. Austin is not a zoom town. Boise is. If I am not wrong, their formula use median income of the city population. Many of the purchases made in the last two years are by incoming techies whose median income is much higher than the median income of the city population. Compute using techies’ median income, housing is not overvalued The issue is for zoom towns like Boise, with back to office (hybrid), these techies can’t stay in zoom towns.
“It’s pretty straightforward: As long as mortgage rates remain elevated, housing transactions (i.e., home sales) will remain sluggish. Home prices are a different story. While homebuilders and investors might be more inclined to cut prices, average joe sellers will resist doing so. There’s an emotional element: Sellers don’t want to give up on the number in their head. Not to mention, a solid job market means sellers aren’t desperate. All of that seller hesitancy, coupled with uncertainty surrounding inflation and the broader economy, explains why so many forecasters remain split on the trajectory for home prices.”
I should start charging people who are copying what I said back in March.
Home prices fell for the first time in 3 years last month – and it was the biggest decline since 2011
Some local markets are seeing even steeper declines over the last few months. San Jose, California, saw the largest, with home prices now down 10% in recent months, followed by Seattle (-7.7%), San Francisco (-7.4%), San Diego (-5.6%), Los Angeles (-4.3%) and Denver (-4.2%).