{"id":20869,"date":"2022-08-09T13:34:02","date_gmt":"2022-08-09T13:34:02","guid":{"rendered":"http:\/\/www.anthonydidonato.net\/wordpress\/?p=20869"},"modified":"2022-08-09T13:34:04","modified_gmt":"2022-08-09T13:34:04","slug":"market-to-ease-despite-high-home-prices","status":"publish","type":"post","link":"https:\/\/www.anthonydidonato.net\/wordpress\/market-to-ease-despite-high-home-prices\/","title":{"rendered":"Market to Ease Despite High Home Prices"},"content":{"rendered":"\n

Market to Ease Despite High Home Prices<\/p>\n\n\n\n

Even though national GDP contracted for the second quarter in a row and home sales have fallen for five straight months, property prices are likely to continue growing because of low inventory, Lawrence Yun, chief economist for the National Association of REALTORS\u00ae, said Wednesday during NAR\u2019s quarterly Real Estate Forecast Summit<\/a>. Yun offered his economic and housing market predictions for the remainder of this year and into 2023 at the event.<\/p>\n\n\n\n

One of the most unusual aspects of the current economy is the labor market, Yun said. There were more job openings than unemployed people in May\u2014with the difference being nearly two to one, according to Bureau of Labor Statistics data. Construction job openings were at a record high in January, and these unfilled jobs point to a potential slowdown in the housing market, Yun said.<\/p>\n\n\n\n

Both existing-home sales and pending home sales have been falling or stagnant for months, NAR data shows. Rising mortgage rates have combined with low inventory to exert downward pressure on the market. \u201cClosing activity will continue to sink even more,\u201d said Yun. \u201cSome [potential home buyers] don\u2019t want to pay higher monthly rates. Others can\u2019t.\u201d<\/p>\n\n\n\n

Hope for Consumers<\/h4>\n\n\n\n

There are bright spots in the market, such as gradually increasing inventory, which is good news for consumers. \u201cThey no longer have to make an offer after seeing only one [house],\u201d Yun said. \u201cThey can see three or four. It\u2019s returning to a normal process.\u201d<\/p>\n\n\n\n

Despite some homes with high list prices beginning to languish on the market, the overall lack of inventory is still leading to price gains. \u201cEven after reductions, prices are still higher compared to one year ago and much higher compared to before the pandemic,\u201d Yun added.<\/p>\n\n\n\n

Though the Federal Reserve is expected to hike interest rates<\/a> several more times this year, Yun said mortgage rates won\u2019t rise much further because lenders have already priced in the potential increases. This can mean increased opportunity for consumers. \u201cWe may be topping out independent of what the Fed will do,\u201d Yun said. \u201cRates will go a little up and a little down. It may be a good idea to lock in when the rates are down.\u201d<\/p>\n\n\n\n

He also noted that foreign investment in U.S. real estate is still well short of pre-pandemic levels but predicted that international interest is likely to increase as travel restrictions ease.<\/p>\n\n\n\n

Finally, Yun predicted that in 2022, total home sales will be down 13% from the previous year, home prices will be up 11% and total dollar volume will be down 2%. For 2023, he predicted no increase in home sales, a 2% hike in prices and a 2% increase in dollar volume.<\/p>\n\n\n\n

Current Trends and Market Opportunities<\/h4>\n\n\n\n

Jessica Lautz, NAR\u2019s vice president of demographics and behavioral insight, also provided data from the June REALTORS\u00ae Confidence Index<\/a>. Among her key findings:<\/p>\n\n\n\n