Wednesday, August 7, 2024 / by Dick Keenan
Are Home Prices Going To Come Down?
The current news about home prices can be confusing, making it hard to understand what's really happening. Some headlines suggest home prices are due for a correction, but what does that actually mean? Let's break it down.
What Does a Correction Mean?
Danielle Hale, Chief Economist at Realtor.com, explains:
"In stock market terms, a correction generally refers to a 10 to 20% drop in prices. . . We don't have the same established definitions in the housing market."
In real estate, a correction doesn't mean a dramatic drop in prices. Instead, it indicates that prices, which have been rising rapidly in recent years, are now stabilizing and growing at a more moderate pace. While prices can vary significantly by local market, a steep national decline isn't what's happening.
The Real Estate Market Is Normalizing
From 2020 to 2022, home prices surged due to high demand, low interest rates, and a shortage of homes for sale. However, such rapid growth couldn't continue indefin. ...
What Does a Correction Mean?
Danielle Hale, Chief Economist at Realtor.com, explains:
"In stock market terms, a correction generally refers to a 10 to 20% drop in prices. . . We don't have the same established definitions in the housing market."
In real estate, a correction doesn't mean a dramatic drop in prices. Instead, it indicates that prices, which have been rising rapidly in recent years, are now stabilizing and growing at a more moderate pace. While prices can vary significantly by local market, a steep national decline isn't what's happening.
The Real Estate Market Is Normalizing
From 2020 to 2022, home prices surged due to high demand, low interest rates, and a shortage of homes for sale. However, such rapid growth couldn't continue indefin. ...
