Barron's: The Housing Market Is In Recession

Barron’s headline: The Housing Market Is in Recession. What It Means For Home Buyers.

By Shaina MishkinFollow
Aug. 29, 2022 2:30 am ET…

". . . Historically low rates in 2020 and 2021 helped annual sales soar to levels unseen in more than a decade. Now, following this year’s spike in the 30-year mortgage rate, would-be buyers who could have afforded a home at last year’s rates have pulled back.

Those rates aren’t expected to return to historically low levels. Mike Dahl, an analyst covering home builders at RBC Capital Markets, says prospective buyers in many metros are stressed relative to local historic norms. “By no means has this modest pullback in rates from 6% to five and a half percent all of a sudden cured the affordability challenges that are fairly acute in most key markets,” Dahl said. “We expect the declines in demand to really persist in a meaningful way for some time.”

These worsening conditions have led economists to use the “R word” to describe the housing market’s slowdown. “Tighter monetary policy from the Federal Reserve and persistently elevated construction costs have brought on a housing recession,” National Association of Home Builders chief economist Robert Dietz said earlier in August. The trade group’s latest forecast for 2022 sees existing- and new single-family home sales dropping about 14% and 16% from last year, respectively."

Yeah, this is definitely not going to help $Z $ZG Zillow’s business when fewer homes are selling and fewer Realtors advertise.

Yun was one of the biggest cheerleaders at the NAR back in 2008, and he scoffed at people saying Housing was in a Bubble. Check out his tune today, it sounds as though he has learned something from his burst arrogance of 2009:

Lawrence Yun, chief economist of the National Association of Realtors, characterized the recent pullback similarly. “We’re witnessing a housing recession in terms of declining home sales and home building,” he said earlier this month.