The mid-pandemic housing boom’s 43% run-up in U.S. home prices pushed affordability to a tipping point, and as a growing number of priced out buyers take the high road and delay their purchasing plans, Fed Chair Jerome Powell warns that a full-blown market correction is underway. Not only are home prices at historical highs, but mortgage rates are also steadily rising as the Fed works to slow buyer demand and rein in astronomical prices. So far, its plans are working, says Fortune.
Of the 392 regional housing markets tracked by CoreLogic, 64 markets currently have "high" odds of falling home prices over the coming 12 months, while 289 markets are in the "very high" odds group.
The November assessment finds 354 markets have a greater than 50% chance of notching a negative year-over-year reading (i.e. markets in either the "high" or "very high" risk groups) over the next 12 months. That's up from 335 markets in October that had a greater than 50% chance of falling home prices.
The correction is so sharp that Boise—which saw its year-over-year rate peak at 47% between July 2020 and July 2021—has already gone negative in 2022 on a year-over-year basis. Indeed, Boise home prices are down 7.1% since its 2022 peak, and down 4.3% on a year-over-year basis.
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