Meet Experts Who Say Houses Get Cheaper Soon

Factors Contributing to the Price Shift

One of the main factors contributing to the anticipated drop in house prices is the Federal Reserve's monetary policy. As the Fed increases interest rates to combat inflation, borrowing costs rise, making mortgages more expensive. This shift can deter potential homebuyers, subsequently reducing demand and leading to a price correction in the housing market².

Additionally, the pandemic-induced housing boom led to a surge in home construction. As these new homes hit the market, the increased supply can help balance the previously high demand, further stabilizing or reducing prices. The National Association of Home Builders has noted that the completion of these projects could significantly impact market dynamics³.