After a record-breaking run that saw mortgage rates plunge to all-time lows and home prices soar to new highs, the U.S. housing market finally is slowing. While demand and price gains are cooling, any correction is likely to be a modest one, housing economists and analysts say. No one expects price drops on the scale of the declines experienced during the Great Recession.
Rob Dietz, chief economist at the National Association of Home Builders, sums up the consensus among housing experts: “We’re thinking this is going to be a moderate downturn,” he says.
The real estate party raged on longer than anyone expected. The National Association of Realtors reported that median prices in the spring of 2022 topped $400,000 for the first time ever. Prices are up a whopping 39% since the coronavirus pandemic began in March 2020, according to NAR data.
