Home Price Declines will hit another gear in November and December. That's because Homebuyer Demand in the US Housing Market just crashed to its lowest level since 2008.
Data from the National Association of Realtors shows that Existing Home Sales have fallen to 4.7 Million in September. While data from the Mortgage Banks Association shows Mortgage Applications collapsing even further. Suggesting that Sellers will need to cut home prices by even more in the Winter 2022 Housing Market to sell their houses.
This will cause Housing Prices to crash further. Especially in already hard-hit Housing Markets such as Austin, Phoenix, Las Vegas, and San Francisco. These markets, as well as the rest of the West Coast of America, is where the Housing Crash started.
But it is now spreading to other Parts of America. Southeast states like Florida are now experiencing a big drop in Homebuyer Demand. Pending Home Sales in Naples decline by 73%. In Jacksonville by 50%. The Florida Delusion is clearly over and its Housing Market is crashing.
But perhaps even more concerning for the Real Estate Market is that Rental Demand is collapsing alongside Buyer Demand. According to RealPage, the 3rd Quarter of 2022 was the worst one for apartment leasing in America in over 30 Years. This is a signal that the Double Barreled Housing Crash is continuing and that Rents will be declining as well.
The combination of declining Buyer and Rental Demand signals that Inflation will likely convert to Deflation in future months. And that Interest and Mortgage Rates will go down as well.
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