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What number of Americans think US housing market is heading for ‘crash’


A good portion of Americans fear the once-booming housing market is headed for a big crash within the months ahead, recent survey results from LendingTree showed.

Based on the survey, 41% of Americans expect the housing market to crash inside the subsequent 12 months. By comparison, just 25% of respondents said they expect the sector to avoid a crash, while 34% said they weren’t sure.

Of those that expect a crash, a whopping 74% consider it’ll be as bad or worse than the housing market’s implosion in 2008 in the course of the Great Recession.

Some 33% of respondents said inflation was essentially the most significant reason for a predicted crash, while 24% pointed to higher rates of interest and 16% called out an absence of reasonably priced housing.

Conditions throughout the housing sector have deteriorated this 12 months as surging mortgage rates crush buyer demand and force sellers to lower their listing prices. Mortgage rates have declined in recent weeks but are still hovering at a mean of 6.49% — greater than twice as high as they were in January.

Rising mortgage rates have crimped buyer demand.Bloomberg via Getty Images

Despite mounting fears amongst consumers, the housing market is more stable than it was ahead of the Great Recession, based on LendingTree senior economist Jacob Channel.

“Today’s homeowners are in a a lot better position to proceed to make their payments, even when we enter a recession,” Channel said. “It’s necessary to notice that the explanation why the market crashed in 2008 was because there was diminished demand for homebuying and a large influx of homes hitting the market because of high foreclosure rates.

A chart showing rate hike predictions in relation to the fear of rising mortgage rates.A chart showing rate hike predictions in relation to the fear of rising mortgage rates.LendingTree

“Without delay, we do have reduced demand for brand new homes, but no massive influx of supply, which puts us in a a lot better position,” Channel added.

Still, Channel noted that home price declines of 5% to 10% “seem reasonable to me” in lots of markets across the country.

LendingTree chartMillennials were most afraid of a possible housing crash.LendingTree

“While I do think the housing market will proceed to slow over the subsequent 12 months and a few people may find yourself underwater on their mortgages in consequence, a serious crash doesn’t appear likely — at the least not in the mean time,” Channel said.

Some experts say the decline in home prices shall be more extreme, potentially dipping 20% from recent peaks within the months and years to return.

LendingTree chartInflation was a key concern for the housing market.LendingTree

Millennials were almost definitely to predict a looming housing market crash – with 44% of respondents in that age bracket stating they think a meltdown is imminent. Baby boomers were least concerned, with 35% predicting a crash.

Economic fears aren’t limited to homeowners. A 61% share of renters said their monthly rent payments were dearer than they’ve been or needs to be, based on their experience.

Rising shelter costs are a key driver for inflation, which moderated barely in October but remains to be running well above the Federal Reserve’s acceptable range. An update on inflation for November is due next week.

As The Post reported this week, US listings of homes on the market were pulled off the market at a record clip in November. Experts at Redfin attributed the trend to surprise amongst homeowners who were receiving less interest and lower bids than they expected from cost-conscious buyers.

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