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Moody’s Chief Economist Says the Real Estate Market Will Dip, Not Crash. Here’s Why That’s Bad.
Mark Zandi, Moody’s Chief Economist, calls for a housing correction, not a crash. Here’s why he is right and why it’s bad for the housing market.
I feel awful for renters and young people right now. Student loan debt, inflation, rising healthcare costs, technology addiction, climate change, and now this. The American Dream of owning a home is slipping into a pipe dream.
The Fed has raised interest rates to a point where buying a home is unaffordable for most potential consumer buyers. In June, the average US home sold for over $400,000. Meanwhile, a typical American family with a $76,563 household income would be hard pressed to find $2,500 a month for a home mortgage and insurance after shelling out $80,000 on a down payment.
Big institutional money recognizes owning property is excellent in an inflationary, deflationary, recession, or boom environment. Real estate is finite and always appreciates over time. Owning residential property is almost a can’t-lose proposition. This is especially true if you are a multi-billion corporation. How come? People will always need a place to live.
“If you don’t own a home, buy…
