Housing Market Slowdown Expected, But Experts Say Crash Unlikely Due to Tight Supply and Steady Demand
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Home prices are still rising due to low inventory levels and strong buyer demand. The median existing home price hit a new October record high of $391,800.
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Mortgage rates have surged above 7%, reducing affordability, but supply remains extremely tight at just 3.6 months. This prevents a meaningful price decline.
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Compared to 2005-2007, homeowners have far more equity now, strict lending standards prevent a subprime collapse, and builders are being cautious - all reasons a 30% crash is unlikely.
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While prices may plateau or see modest declines in some markets, economists say overall there will be no housing market crash. Demand remains too strong and supply too low.
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Five reasons there won't be a crash low inventory, insufficient construction, steady buyer demand, strict lending rules, and fewer foreclosures than last time.