Is the Housing Market Becoming More Buyer-Friendly?
After steep consecutive gains throughout the majority of 2022, home price growth is moderating across the country, says MarketWatch. The latest S&P CoreLogic Case-Shiller U.S. 20-city price index revealed a 1.2% drop in September. A housing slowdown is giving buyers more bargaining power, but as a growing number of sellers opt to stay put, inventory is dwindling.
Housing experts like Lisa Sturtevant, chief economist at Bright MLS, expect home prices to cool throughout the remainder of the year, but high mortgage rates and a possible recession will continue to hurt affordability even as the market becomes more buyer-friendly.
“We are seeing demand falling back in the face of strapped budgets and potential sellers staying put, causing inventory to continue to struggle,” [Nicole] Bachaud said. “Price growth will likely continue to moderate, and in the short term prices will likely continue to fall. But this is all part of the housing market rebalancing, which will lead to a healthier, more stable market down the road.
Home prices will fall by 8% next year, a report published this month by independent research firm Capital Economics said, but high mortgage rates and a possible recession will continue to hurt affordability. With lending standards still tight and affordability poised to worsen, consumers should expect their purchasing power to deteriorate even as housing prices fall, the group said.