Housing analyst Ivy Zelman was an early predictor of the 2008 housing bust even as other market experts assuaged fears with more bullish forecasts, and in 2022, she’s sounding the alarms of another big change ahead in a cooling market. In February, the Zelman & Associates founder accurately called the “peak” of the Pandemic Housing Boom, and now, she says the market is poised for a significant price reduction in the months and years ahead, Fortune reports.
Zelman predicts that U.S. home prices will fall 4% in 2023 and another 5% in 2024 as inventory levels rise and demand falls from record highs.
“So right now we’re getting a backlash of the change in direction from free money to now the rise in [mortgage] rates and inflation. So the market is poised for a fairly significant [price] correction. And we’re already seeing signs of that over the last several months,” Zelman recently said on the Macro Hive Conversations podcast.
Zelman’s outlook amounts to a 8.8% drop in U.S. home prices between 2022 and 2024. Historically speaking, that would make this one of the three sharpest home price drops ever recorded. The other two being those from the Great Depression and Great Recession.
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