NAR Chief Economist Lawrence Yun forecasts slowing price growth, but not a nationwide decline in home prices. "In the near term, I do not expect the situation to change appreciably," Yun said Thursday. "Historic undersupply in the market, combined with continued demand, will likely drive ongoing issues with affordability for many Americans… Any short-term price adjustments, if they occur, will be less consequential compared to the immense longer-term housing affordability challenges we face as a country."
Yun testified before the U.S. Senate Committee on Banking, Housing, and Urban Affairs last week amidst a 6 million unit housing shortage nationwide. Despite economic slowdowns the country has experienced a record 124 consecutive months of housing price growth. Thanks Obama! (Hey we blamed him for the bad, shouldn’t we thank him for the good too?)
"When the Federal Reserve essentially went all-in in the early months of the pandemic … the decline in mortgage rates and the cautious reopening of the economy boosted housing demand," said Yun, also NAR's senior vice president of research.
"Any increases in available inventory observed over the first half of this year have been offset by the corresponding increases in consumer costs," said Yun. The increases in mortgage rates have essentially added about $800 per month to the median house payment.