Will the Fed’s Actions Impact the U.S. Housing Market in the Coming Year?

Declining Housing Market

Written By: M&M Properties - Sacramento Property Management

January 27, 2023

The U.S. housing market will change this year due to the Federal Reserve’s actions to slow overall activity and lower inflation, according to Susan Wachter, a Wharton professor of real estate and finance. Pending home sales are at historic lows and home prices are down as mortgage rates reach record levels. Housing supply is also low because of declining new housing construction and existing homeowners unwilling to sell their homes financed at low rates and move into newer homes at double the mortgage rate. Demand is low not just because of costlier financing and fears of an imminent economic recession, but also due to more young Americans staying with their parents and declining household formation. The multifamily rental housing market has seen a construction boom and rising rental rates, but those rates are beginning to slow down.

Please view the article written by Susan Wachter.

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