Going down! The US housing market, that is!
Federal Reserve Jerome Powell said at the luncheon in New York City that “Inflation is still too high”, meaning that rate cuts are on hold and maybe a rate hike or two may come.
According to the National Association of Realtors,
• Active inventory declined, with for-sale homes lagging behind year ago levels by 2.7%. For 17 straight weeks, the number of homes available for sale has registered below that of the previous year.
• New listings–a measure of sellers putting homes up for sale–were down again this week, by 4.4% from one year ago. Since mid-2022, new listings have registered lower than prior year levels, as the mortgage-rate lock-in effect freezes homeowners with low-rate existing mortgages in place. Although the year over year declines are smaller now than the double-digit pace seen earlier in 2023, declines from the pre-pandemic period are still substantial.
Inventory remains far below levels seen before the financial crisis. But Case-Shiller National Home Price Index (blue) remains elevated along with The Fed’s balance sheet (red) which is barely below $8 TRILLION. And Powell didn’t say much about speeding up the trimming of The Fed ballast.
