Real estate experts have warned that the U.S. housing market appears unlikely to become significantly more affordable in the near term. This comes as both mortgage rates and home prices remain high.
Bankrate mortgage analyst Jeff Ostrowski claimed that while mortgage rates and home prices may be able to drop in price marginally in the coming months, no significant drop can be expected over the next two years. This is because the Federal Reserve is expected to keep interest rates high, thereby putting upward pressure on mortgage rates. Ostrowski forecast mortgage rates to float between 5% and 6% over the next year.
Redfin deputy chief economist Taylor Marr agreed with this sentiment, predicting that mortgage rates would ease to approximately 6% by the end of the year. “It feels like prices aren’t really changing much and interest rates aren’t changing much,” Marr admitted. “We’ve been describing it sort of like a game of musical chairs, where most participants are just in their seats, and once people start to get up out of their seats, that’s where there will be affordable housing opportunities.”