According to the results of a Reuters poll, the US housing market could be seeing cracks beginning to show, with expectations of a rapid slowdown on the horizon.
After falling by a third during the financial crisis a decade ago, U.S. house prices have mostly recovered all their losses, rising at more than double the rate of inflation and wages over the last five years.
“The peak in price increases has been reached and with rates rising further and the economy slowing, price gains can only decelerate,” said Joel Naroff, chief economist at Naroff Economic Advisors.
A majority, 17 of 29 analysts who answered an additional question, said U.S. housing market turnover has already peaked.
“The magnitude and speed at which home sales have weakened is surprising, following just a three-quarter of a percentage point rise in mortgage rates. We suspect the problem is a lack of affordable product in the markets where potential home buyers would like to live,” wrote Mark Vitner, senior economist at Wells Fargo, in a note to clients.
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