The housing market is unlikely to recover for several years and affordability won't get any better unless a recession hits, according to Bank of America economists. In a mostly pessimistic outlook on the sector, the bank sees a variety of factors lining up against both a major improvement in sales and a drop in prices that would bring younger buyers back into the market.
Now, with 30-year rates still hovering around 7%, the "lock-in effect" has meant that owners can't afford to sell into a market where they will pay rates more than double when they bought their homes. That has dampened sales but not prices , with little relief expected anytime soon as Fed officials have doused hopes for significant policy easing anytime soon, and as supply levels remain constrained.