For the U.S. housing market to return in line with its fundamentals, researchers estimated that it would need to experience a 19.5% decline. (David Paul Morris/Bloomberg via Getty Images / Getty Images)
U.S. home prices could tumble as much as 20% as the highest mortgage rates in two decades threaten to trigger a “deep global housing slide,” according to research from the Federal Reserve Bank of Dallas.
The global housing market has become increasingly “frothy” since 2020 as a result of the pandemic boom, the Dallas Fed economists wrote in the analysis published this week. Although house-price growth has recently begun to moderate, there are still risks of a more severe decline.
The economists — Lauren Black and Enrique Martínez-García — pointed to signs of trouble detected in the U.S. and German housing markets that threaten to “pose a vulnerability to the global outlook because of the size of those nations’ economies and significant cross-border financial spillovers.”
Read more here: https://www.foxbusiness.com/economy/us-home-prices-could-plunge-risk-deep-housing-slide-fed-economist-warns
