US home price plunge is ‘just beginning’ as housing market rapidly cools: economist

is likely “just beginning” as decades-high mortgage rates cause a downturn in the housing market, a prominent economist cautioned Friday.

The warning from Pantheon Macroeconomics chief economist Ian Shepherdson followed more dismal data that showed a slowdown in housing activity. Pending home sales — a measure based on signed contracts — plunged 10.2% in September, according to the National Association of Realtors.But cratering demand has only recently started to result in lower home prices — meaning more financial pain is on the way for prospective sellers.

“The bad news is that prices have much further to fall before the market adjusts fully to the collapse in demand,” Shepherdson said in a note to clients. “Home prices have only recently started to decline on a month-to-month basis,” Shepherdson added. “The resilience in prices was made possible by a lack of existing homes on the market, but supply is now rising — albeit slowly — as homeowners who previously held off on selling worry that further delays will mean they fetch a much lower price.”

30 to 50% drop in value incoming in many markets. 2008 crash was 33% average.

Is that Pelosi’s house?

But unlike 2007-2010 when housing was overbuilt and subprime mortgages were blowing up, tight supply and 90 percent of mortgages having low fixed rates will limit the downside of values. A return to the long-term trend line would see a 10 to 15 percent drop.

Business Business Latest News, Business Business Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

Home prices in this NY region are defying the US housing market slump: dataThe median sale price of homes sold on Long Island hit a record $620,000 during the third quarter. Home prices aren’t falling fast enough to justify interest rates, monthly payment matters.
Source: nypost - 🏆 91. / 67 Read more »

What it’s like to buy and sell in the new, weird housing marketA dispatch from home buyers, sellers and real estate agents about what it's like to navigate the housing market amid soaring mortgage rates and stubbornly high prices. I was interviewed but they didn’t include my quote “It sucked, and continues to suck, ass” The Biden effect caused high-interest rates for all new home buyers. That means an added few hundred dollars a month that you wouldn't have had to pay if under TFG.
Source: washingtonpost - 🏆 95. / 72 Read more »

N.J.’s real estate market is cooling with median home prices down in 16 countiesThe number of days homes are spending on the market is up in 17 New Jersey counties and the number of new listings are down in 12 counties.
Source: njdotcom - 🏆 282. / 63 Read more »

Ranked: 30 housing markets where home values are cooling the fastest - Jacksonville Business JournalThe national housing market slowdown has been one of the headlining stories of 2022, after a spike in mortgage rates in the spring turned the heat off what had been historic price growth and buyer demand through most of the pandemic.
Source: JaxBizJournal - 🏆 599. / 51 Read more »