When Will the Housing Market Crash?

The US housing market is going through some rough times in 2023, and it has differing opinions on the future of the market. 

In the past years, the US housing market has experienced some significant growth during these periods, with record-low mortgage rates and high demand pushing the prices of homes high. 

However, there are concerns about the market, as experts are saying that the US housing market might crash soon.

In this article, we will take a critical look at the factors that may contribute to a potential crash in the future.

Will the Housing Market Crash?

Inflation is on the rise, and there is fear that a recession may come soon. However, a lot of real estate professionals do not believe that the housing market is closing up or poses a threat to the faltering economy.

In the past, housing led to one of the worst financial crises in history, with lots of small mortgages closing up and lots of new houses being vacant. This led to many Americans going bankrupt due to the housing crisis. 

Although there have been no bigger crises in America like the era of the Great Depression that took place in 1929, leaving many homeless, the housing market witnessed a significant crash during the Great Recession of 2007.

At the moment, real estate professionals believe that the housing market will not crash or spike into a recession, which they believe will help shape the economy. 

The mortgage sector, on the other hand, has taken actions against loans that were increased or those implemented to have many defaulters. To address this, only purchasers with consistent, verifiable income may now qualify for mortgages.

This development has helped reduce the risk compared to subprime borrowing during the Great Recession of 2005,-2007. Lots of bad mortgages have been removed, and lenders have stricter requirements for borrowers. A shortage of housing has led to many individuals purchasing and renting available houses.

Housing growth has declined year-over-year with housing affordability and mortgage rates dropping. This means that homeowners will be unable to pay for mortgages, and those experiencing financial issues may eventually sell their homes.

While the US housing market is experiencing issues, many real estate professionals don't believe it will crash or trigger a recession.

Will the Housing Market Crash Again?

There are some concerns about the housing market about whether it will crash again or not, but one of the driving forces behind home price growth is the lack of supply and higher rates. 

This has held back many potential sellers and new construction. As such, there is no relief in sight for an improvement in the housing supply and the sustainable housing market that would come with increased inventory.

As we enter the second half of 2023, many are still wondering whether the housing market is going to crash. However, there has been speculation that the housing market will crash, and people are holding on to see what the future holds. 

While there are signs of a slowdown in the housing market's year-over-year growth rate, the overall data and forecasts suggest that a crash is unlikely in 2023.

Let us analyze the latest data provided by CoreLogic to gain insights into the current housing market trends and whether a crash is imminent.