When will house prices come down?

mathjak107 said:
House prices don’t fall in a vacuum …local economies crumbling is what brings down home prices .so that means job losses , pay cuts and all assets worth less.

maybe like 2008 banks will stop loaning money for mortgages
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Another reason house prices fall is because mortgage rates are high. It only needs a rise of a couple percentage points to price some buyers out of the market.
 
mathjak107 said:
House prices don’t fall in a vacuum …local economies crumbling is what brings down home prices .so that means job losses , pay cuts and all assets worth less.

maybe like 2008 banks will stop loaning money for mortgages
Click to expand...
Thanks to the bundling and credit default swaps of 2006-2008 bubble. Have a friend who was the the mortgage loaning biz back then. He said they put people in homes that they knew would be foreclosed on in the near future. It was cheaper to buy a house then than it was to rent an apartment.

Laws have been changed - tightened big time -so hopefully that won't happen again.
 
They are falling in Phoenix now. But…they had been escalating in price in the double digits for several years, and the phenomenally low interest rates made it ridiculously easy for people to get into even inflated priced homes. Now with interest rates closer to the 80’s the loan qualification process becomes harder.
 
The general economy, inflation, and rising interest rates are making it harder for people to afford a mortgage. But the lack of new home construction is keeping the supply of housing low, while demand continues to increase. If, as the "experts" predict, we slide into a recession in 2023, that will have a marked impact on housing prices.
 
Gary O' said:
I'm not so sure they are 'coming down'
I think it may just be a correction from the latest crazy leaps in 'market value'
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According to the people I've been reading in and out of the market, I interpret their thinking to be: 1. Prices are coming down in areas of the US, but it will eventually spread to all of the areas where people where moving to since 2019 (residential only). 2. Realtors are beginning to see prices come down and you can get a cheaper houses, but if we buy now, our house values will still be falling further until the end of next year. 3. Best lower prices could be seen at the end of 2023 or first half 2024. 4. I've talked to some realtor friends who tell me potential buyers have evaporated here in DFW in just the past month. Not a good situation for sellers.
 
One aspect of the issue is the dominant media narrative is solidly in the camp of Wall Street and real estate corps whiners when they report news on housing costs. They always make it sound as though falling housing costs are a horrible thing that must be eliminated. They never report on how those costs, and world wide effects of our Neocon's proxy Ukraine War, are the MAJOR components and drivers of the current outrageous inflation.

For the first time in about a month, I watched the morning Today NBC show for about a half hour. And that is just how they spewed out today's news as decreasing housing values as a very bad thing while the increased mortgage rates are decreasing home prices. Well dummy, isn't that why borrowing rates for the huge predatory financial corps have been raised up from the pandemic $0 zero was because of what they were doing that is skewering all we working class folks?
 
Don M. said:
The general economy, inflation, and rising interest rates are making it harder for people to afford a mortgage. But the lack of new home construction is keeping the supply of housing low, while demand continues to increase. If, as the "experts" predict, we slide into a recession in 2023, that will have a marked impact on housing prices.
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You mentioned inflation so I am taking the opportunity to share this.
Watch: Chart-armed Katie Porter proves that corporate greed is the primary cause of inflation - Alternet.org
 
Alizerine said:
You mentioned inflation so I am taking the opportunity to share this.
Watch: Chart-armed Katie Porter proves that corporate greed is the primary cause of inflation - Alternet.org
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I read the link and am not sure I completely agree with Ms. Porter. She makes some valid points, but I believe does not get to the root of the problem.

I believe the base cause of inflation is the government deficit spending. It puts more dollars into circulation with no more goods or services to spend them on, so of course prices go up. A quote from the article:

Equipped with one of her easy-to-read, data-filled posters, Porter got Konczal to admit that surging corporate profits are forcing American consumers to pay significantly more for goods and services.

I am sure much of corporate America supports the surplus spending and is taking maximum advantage of it, hence the higher profits. However they could not get away with that had our government not handed out all those dollars.
 
Home prices are already falling in over-inflated cities like Seattle. We are now also seeing more real estate inventory on the market here in Dallas. As the Fed has raised interest rates and mortgage interest rates have increased, there are fewer people in the market for homes. The following article was on Marketwatch.

When will house prices drop? These economists say prepare for a ‘prolonged slowdown’ — and big declines in home values​

Last Updated: Oct. 17, 2022 at 12:23 p.m. ETFirst Published: Oct. 10, 2022 at 10:47 a.m. ET
By

Aarthi Swaminathan​



Most economists are forecasting home-price appreciation to slow, with others predicting deeper price drops

Mortgage rates are at multi-decade highs, making home ownership more expensive for Americans.​


The real-estate market is taking a beating, with mortgage rates surpassing 7%.

“Rates are still rising, and will continue to rise here on out,” Christine Cooper, chief U.S. economist and managing director at CoStar Group, told MarketWatch in an interview.
But with home prices continuing to be elevated, that has really hurt affordability, she added, and pushed buyers out, which will hurt home sales.

And “it’s going to continue until we’re gonna see some price declines,” Cooper said. “And we’re seeing signs already.”
Sellers were holding out hope that the situation may improve, Ali Wolf, chief economist at Zonda Research, a housing market-research platform, told MarketWatch in an interview on the Barron’s Live podcast.
“What we’re hearing from the sellers’ side is that they definitely feel nervous that they’ve seen demand fall off,” Wolf said.

Builders and realtors initially thought that demand would slow, then recover, she added, but as rates continue to climb higher and consumers pull back, they’re seeing the writing on the wall.
In a recent survey by Fannie Mae FNMA, -2.06%, sentiment among home buyers dropped to the lowest level since 2011: 75% of respondents said that it’s a bad time to buy a home.
They’re saying “It’s not just a couple months, this may be a prolonged slowdown in the housing market,” Wolf said.

Will home prices drop in 2023?​

Most economists are forecasting home-price appreciation to slow, and it has. Home prices, in fact, fell slightly on a month-over-month basis.

But others are increasingly talking about how they’re expecting corrections of 5% to 10%.
The median price of an existing home was $389,500, as of August, the National Association of Realtors said.
Mark Zandi of Moody’s Analytics is expecting national home prices to fall 10% peak-to-trough, and by 20% if there is a recession. “Buckle in,” he wrote on Twitter TWTR, +1.18%.
“Assuming rates remain near their current 6.5% and the economy skirts recession, then national house prices will fall almost 10% peak-to-trough,” he added. “Most of those declines will happen sooner rather than later. And house prices will fall 20% if there is a typical recession.”
‘Buckle in.’
— Mark Zandi, chief economist of Moody’s Analytics, on the expected fall in house prices
Ivy Zelman, CEO of Zelman & Associates, expects national home prices to fall 4% in 2023, and 5% in 2024.

One developer, Don Peebles, CEO of Peebles Corporation, is expecting home prices to fall 15 to 20% within the next 18 months, The Real Deal reported on Friday.
Goldman Sachs is expecting home prices to fall 5% to 10% from the peak.

Wolf of Zonda expects a correction of 5% to 10%.
“We think some markets will see a more dramatic drop — some of the markets that had a really massive run up,” Wolf explained. “But they don’t come down anywhere like the Great Recession.”
Parts of the country like the Coachella Valley, Salt Lake City, parts of Denver, Boise, Las Vegas, Phoenix, Austin, all saw prices rise very sharply, she added.

Cooper of CoStar said that she’s seeing prices fall not just in pandemic boomtowns but also in expensive markets like San Francisco, San Jose, San Diego, and Seattle.
“There was a belief among investors and even among the development community that prices could only go up forever,” Wolf said, “and they had to build the homes because we’re so undersupplied.”
She added that there is a “limit to what people are either willing or able to pay.”
 
squatting dog said:
First started leveling off here in our area of Florida, now starting to come down. 3 weeks ago, 3-2 house's were selling for $350,000 and up and most were pending or sold. Today, some of the house's we were watching are now asking $299,000 or less.
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I believe it. Florida has been an up and down state for me with regards to real estate (at least in the Tampa Bay Area). We used to own property there, and bought it at an absurdly low rate in the 90s. Then prices went up a few years later, then back down, then up higher...then down....like a roller coaster...it was difficult to time it right to sell.
 
rasmusjc said:
According to the people I've been reading in and out of the market, I interpret their thinking to be: 1. Prices are coming down in areas of the US, but it will eventually spread to all of the areas where people where moving to since 2019 (residential only). 2. Realtors are beginning to see prices come down and you can get a cheaper houses, but if we buy now, our house values will still be falling further until the end of next year. 3. Best lower prices could be seen at the end of 2023 or first half 2024. 4. I've talked to some realtor friends who tell me potential buyers have evaporated here in DFW in just the past month. Not a good situation for sellers.
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It is not a good situation for sellers, but it is a good situation for those of us who intend to stay in our homes in the DFW area for years to come. We've lived in our home for 16 years, and the rise in house prices has made our property taxes astronomical. The last house to sell in our neighborhood sold for more than twice what we paid for ours. If we have no intention of selling, we are penalized.

I actually welcome the relief. I drive through the Lakewood area of Dallas frequently, and in past months a For Sale sign would be in front of a house one day and then a Sold sign would be up within a few days. Now the For Sale signs are staying in the yards.
 
dseag2 said:
It is not a good situation for sellers, but it is a good situation for those of us who intend to stay in our homes in the DFW area for years to come. We've lived in our home for 16 years, and the rise in house prices has made our property taxes astronomical. The last house to sell in our neighborhood sold for more than twice what we paid for ours. If we have no intention of selling, we are penalized.

I actually welcome the relief. I drive through the Lakewood area of Dallas frequently, and in past months a For Sale sign would be in front of a house one day and then a Sold sign would be up within a few days. Now the For Sale signs are staying in the yards.
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Well, we took advantage last year of the astronomical prices of homes in the North Texas area and sold our house on the way to downsizing. We moved into this house at the beginning of this year...this house cost 1/3 of the price that we sold our home for, and property taxes are only 40% of what we were paying at the old house. The difference helped a lot in shoring up our retirement funds.

BTW, as an aside, the person we sold our house to claimed he was just going to add on to the house and leave the structure intact. For the fun of it, we went by our old house 2 months ago, and were blown away that everything was gone (leveled) with only the slab left (along with 4 trees removed that were older than the house, and the house was a total brick house, so it couldn't have been easy to demolish). Oh well, that property is his problem now, we're enjoying being retired in this near the country house.
 
rasmusjc said:
Well, we took advantage last year of the astronomical prices of homes in the North Texas area and sold our house on the way to downsizing. We moved into this house at the beginning of this year...this house cost 1/3 of the price that we sold our home for, and property taxes are only 40% of what we were paying at the old house. The difference helped a lot in shoring up our retirement funds.

BTW, as an aside, the person we sold our house to claimed he was just going to add on to the house and leave the structure intact. For the fun of it, we went by our old house 2 months ago, and were blown away that everything was gone (leveled) with only the slab left (along with 4 trees removed that were older than the house, and the house was a total brick house, so it couldn't have been easy to demolish). Oh well, that property is his problem now, we're enjoying being retired in this near the country house.
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What is your property taxes?
 
Some areas in SOME states the prices are already dropping. Other areas, the prices will continue to climb due to decent economy AND over-population.
2 examples: house prices in S.F. Bay area continue to climb., while prices in suburbs of New Orleans are dropping. If you look at the size of 2 quite similar house in those 2 areas, the avg price in Santa Rosa, CA is 1.5 million. A very similar house on the west bank of New Orleans, is only 350,000.

It is still possible to buy a house in the USA for $45,000. (fixer-upper)

Very much info on google.
 

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