US home prices could tumble nearly 20% and Fed economists warn further rate hikes risk an even worse housing correction: ‘The bubble hypothesis merits attention’

March 9, 2023 By: Lexi Malen

As rates continue to rise but inventory remains incredibly low, I don’t see how we could see a 20% housing price correction, but if the spring season has a rush on listings and inventory spikes up it would quickly become a buyers’ market.  The key will be available housing inventory, this will dictate if prices come down.  If inventory remains low we could see further price increases.

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Article: US home prices could tumble nearly 20% and Fed economists warn further rate hikes risk an even worse housing correction: ‘The bubble hypothesis merits attention’

Source: www.Msn.com

Article Highlights

• The Fed’s aggressive rate-hiking cycle has pushed mortgage rates higher over the last year, hitting 7% in October. Earlier this month, mortgage rates fell back near 6% but are heading back up again

• For the US housing market to return to its fundamentals, they estimated that a 19.5% correction would be necessary.

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