Economists expect the U. S. housing market to cool slowly after the white-hot 2021. But community bankers worry that the end of the buying spree will be more dramatic.
According to a survey released Wednesday by software companies MANTL and Wakefield Research, 78 per cent of community bank executives predict that the US real estate market will collapse sometime in the next five years.
This widespread concern comes after months of record-breaking house price rises, making it difficult for buyers to keep up.
According to the CoreLogic house price index, u.s. house prices rose 18.1% in august from a year earlier, the biggest increase in at least 45 years.
The surge in house prices is largely caused by a historic housing shortage. Us home inventories plummeted to a record low in the early days of the COVID-19 epidemic, leading to fierce bidding among buyers. These bids have pushed up house prices and undermined affordability across the country.
Adjusted for inflation, US house prices have risen to record highs for the fifth month in a row. Prices are now above their peak in 2006, before the subprime crisis in the United States triggered the global financial crisis.