Fed awakens an alarm about the ‘deterioration’ of the US housing market – this is what it means for hopeful buyers

United States housing market is in recession and the central bank has taken into account.

Notes of the FED meeting in July Koho’s slow economic growth between members of the Committee’s members in the first half of the year, partly due to decrease in residential investments. Members are considering decreasing demand for housing, more homes for sale and a decline in housing prices.

FED staff also said that housing assessment has decreased but have still increased.

Participants warned that « more significant deterioration in the housing market » is the downside of the jobs.

According to the National Real Estate Association (1), the current home sales only increased by 0.8% after July, but in stocks (15.4% increase) and months of supply (4.0-4.6) increased significantly a year earlier that the market is miserable rather than toasting.

Sales of a new home, seasonally adapted, decreased in July year by year, according to the Census Office. The months of supply of months also increased to 9.2 months, compared with 7.9 months last year.

For the home construction industry, signs indicate a caution that could further exacerbate the under -evaluation of the United States, as economic science in building new houses and the lack of demand for buyers work in one vicious circle for the intricivisation of new construction.

High mortgage rates There may be an impact on the affordability of the dwellings, but lower borrowing costs may not be a silver bullet to revitalize the housing market. Many owners of existing homes are ”locked into“Cheap pandemic era mortgages that have influenced housing problems by making it difficult to move. Fed Research determines almost half of the decrease in US consumer mobility from 2022 to 2022 to the interest rate lock on the mortgage.

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The first buyers may feel the most compression. Governor Adriana D. Kugler’s recent Fed government speech stressed that higher mortgage interest rates would disproportionately reduce the purchase of low-income households, which still pushes dreams of homeowners.