The American housing market is suffering its second-largest price correction since the end of WWII, and one expert attributed it partly to people’s concerns about economic issues.
According to founding partner of Macro Trends Advisors Mitch Roschelle, the correction was due to citizens’ uncertainty and concern about the economy, Fox Business reported Friday:
“A couple of things are going to cause it to turn in the opposite direction, meaning home prices are going up. One is certainty. And when you don’t know if interest rates are going to go up or not. I think that is what is driving a lot of people away from buying because they just don’t know if rates are going to be cheaper in two months, and they’re just going to wait,” Roschelle explained to FOX Business’ Ashley Webster.
“And the other thing is uneasiness regarding the economy. And I think the shoe to drop there would be if we start seeing layoffs, and we start seeing unemployment starting to rise, I think that could be something that causes a leg down in the housing market in a big way.”
Meanwhile, home prices dropped for the third straight month in September, which drew attention to the stress the Federal Reserve’s battle against inflation has caused the market, according to Breitbart News.
Roschelle believes it is currently a buyer’s market but also clarified that did not mean people would not see some bidding wars.
He said, “So, if there’s a house that hits the market that’s perfect, and it ticks all the boxes for buyers and there are buyers out in the market, I think you could see sporadically bidding wars, but mostly, you know, it’s one or two people chasing that house. And we’re not seeing that. We’re not.”
In May, Breitbart News reported major investors are buying up additional housing because they hope to gain from rising rents and housing prices, a practice that would result in a growing class of people who rent.
When it comes to the state of the economy, the majority of Americans say it is getting worse, according to a recent poll.
In addition, “Biden’s approval rating in the latest Echelon Insights omnibus survey sits at 43 percent, while just 39 percent of likely voters approve of how he is handling the economy,” Breitbart News reported December 23.