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by brightstep 1586 days ago
As someone who just sold their home and is currently renting while waiting for a correction, I definitely want this to be true. Why are you confident those factors, absent a rate intervention, will produce a correction?
1 comments

If inflation persists rising mortgage rates will push affordability to record lows. We're already close

If inflation abates quickly, then current prices can maintain and become the new normal.

The rate shock will price out pretty much every primary buyer. Investors will stop buying and even sell if they fear it's a peak.

On top of this, huge amount of backlogged supply is about to come into market in a big way in southern cities. The majority of the building is concentrated there. I would be very worried about Phoenix for example

Why wouldn't housing prices drop if the mortgage rate increased and keep affordability about the same?
Sure, it could. But it's better to buy a lower priced item at a higher rate.

Just look how that worked out for homebuyers in the 80s paying 10%, who were able to refi at 2% later down the line.