The US housing market is 'stuck,' and might remain that way until 2026

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A new Bank of America analyst note suggests that the U.S. housing market is 'stuck' and will not become 'unstuck' unless there is an economic recession.

The affordability crisis that has plagued the U.S. housing market for the last three years is unlikely to improve until at least 2026, according to new findings published by Bank of America. "The U.S. housing market is stuck, and we are not convinced it will become unstuck anytime soon," Bank of America economists Michael Gapen and Jeseo Park wrote in the Monday note. They expect home prices to rise 4.5% this year, 5% in 2025 and 0.

The Bank of America strategists expect the lock-in effect will take at least six to eight years before it goes away, due to the significant gap between current mortgage rates and the rates that many homeowners already have. "The wide gap between current mortgage rates and effective mortgage rates means most homeowners are unwilling to move unless forced," the economists said. "Moreover we do not expect current mortgage rates to fall much even if the Fed cuts as we anticipate.

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Housing market to remain 'stuck' until at least 2026, Bank of America saysThe bank sees a variety of factors lining up against both a major improvement in sales and a drop in prices.
Fonte: CNBC - 🏆 12. / 72 Consulte Mais informação »