Current Housing Market Conditions Likely to Persist Through at Least 2026
Housing affordability has become a major issue in the U.S., exacerbated by the COVID-19 spike in home prices and recent mortgage rate hikes. And the market could stay like this for quite some time. According to CNN, Bank of America economists warn the U.S. housing market will likely remain stuck in this cycle until 2026 or later. This is because housing supply cannot keep up with demand, further driving up prices. Current homeowners are also more likely to stay put right now, further limiting supply.
The bank said home prices will stay high and go even higher. The housing shortage will persist. And mortgage rates may not fall much — even if the Federal Reserve finally delivers long-delayed interest rate cuts.
“This will take many years to work itself out. There isn’t a magic fix,” Michael Gapen, head of US economics at Bank of America, told CNN in a phone interview. “The message for first-time homebuyers is one of patience and frustration.”