Home News Is the ‘home price correction’ coming for your housing market? These interactive maps show Moody’s 2023 and 2024 forecasts

Is the ‘home price correction’ coming for your housing market? These interactive maps show Moody’s 2023 and 2024 forecasts

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of pandemic housing boom This spring, I finally stumbled across that match. Soaring mortgage ratesFinancial markets quickly put upward pressure on mortgage rates as the Federal Reserve moved into anti-inflation mode. Those rising mortgage rates —June hits all-time high at 6.28%– coupled with Soaring housing prices, threw cold water on the housing boom. Home his shoppers have had enough.

we are already quite Declining home sales-marking Fastest US housing market contraction since 2006This homebuyer pullback also features The “upside down” of the housing cycle It started in 2012. Industry Insiders Don’t Think This Is Back in 2008many housing economists warn that if house prices continue to fall, a house price correction could hurt the housing market in some areas.

To find out which housing markets are preparing for falling home prices, luck reached out to Moody’s Analytics to access the latest unique home analytics. The Economist, a financial information firm, has calculated how house prices are likely to change in 414 regional housing markets between the fourth quarter of 2022 and the fourth quarter of 2023. They also projected changes in house prices between Q4 2023 and Q4 2024. .

Let’s see from 2023.

nationwide, Moody’s Analytics predict that US house prices will rise by 0% next year.it’s a dramatic slowdown 19.7% increase in home prices over the last 12 monthsAnd house price growth will be the slowest since 2012.

At the regional level, however, Moody’s Analytics believes it differs significantly.

Of the country’s 414 largest housing markets, 183 will see year-over-year home price increases in 2023, according to forecast models from Moody’s Analytics. New Bern, North Carolina (4.12%); Augusta, Georgia (3.84%); Hartford, Connecticut (3.73%). Casper, Wyoming (3.29%).

Moody’s Analytics predicts that 231 markets are likely to see home price declines in 2023. Punta Gorda, FL (-6%); Reno, NV (-5.57%); Honolulu (-5.56%); Spokane, WA (5.52%).

Moody’s Analytics forecast is far from a housing crash, but it’s not a rosy outlook either. Markets like Austin and Las Vegas have seen a standoff between buyers and sellers this summer. That could change soon. If Moody’s Analytics predictions are correct, sellers in markets such as Austin and Las Vegas will start falling in 2023.

Now let’s look at 2024.

Moody’s Analytics predicts that 236 of the country’s 414 largest housing markets will see year-over-year home price increases in 2024. Casper, Wyoming (4.52%%); Columbus, GA (4.09%); Rocky Mount, NC (3.97%); and San Jose (3.83%).

Meanwhile, Moody’s Analytics predicts that 178 local housing markets are likely to see home price declines in 2023. Punta Gorda (-5.71%); Cape Coral, FL (-4.58%); Lake Havasu, AZ (-4.26%); Spokane, WA (-4.11%).

Many of these at-risk housing markets are already Experiencing the steepest slowdown in 2022Look at Austin.number of homes for sale July is 350% higher than January.

Why are home prices likely to fall in markets like Austin, Phoenix, and Las Vegas? It boils down to the basics.The pandemic housing boom has significantly expanded the housing market in areas like Austin decoupled from underlying economic fundamentals. one time Historically low mortgage rates It disappeared this spring, and prospective buyers are starting to feel its weight. record rising house prices.

Simply Overvalued compared to underlying economic fundamentals We don’t guarantee a home price correction, but a significantly “overvalued” home market is usually where home prices fall the most once the housing cycle “rolls over.”

Markets like Austin and Las Vegas have a bit more bad news. This forecast assumes the US does not enter a recession. When a recession comes Moody’s Analytics reveals that a significantly “overvalued” housing market Home prices are likely to fall between 15% and 20% over the next two years.

Want to stay up to date on the US housing market? Follow me twitter and @News Lambert.

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