Home prices go negative, slightly. Powell says Fed rate cut won’t fix housing challenges.

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Jerome Powell on the housing market:

– “The housing market faces some really significant challenges and I don’t know that a 25-basis point decline in the Federal Funds Rate is going to make much of a difference for people.”

– “Housing supply is low, many people have very, very low-rate mortgages from the pandemic period.”

– “And they kept refinancing and caught the really low so it’s maybe expensive for them to move.

– “Also, we haven’t built enough housing in the country for a long time.”

“We just need more housing.”

“We can raise and lower interest rates but we don’t really have the tools to address, you know, a secular housing shortage, a structural housing shortage.”

Home prices have finally come down compared with last year, though just fractionally, according to daily reads from Parcl Labs, which looks at high-frequency listing data on single-family homes, condos and townhomes, both new and existing.

They may stay softer, though, as home prices are down 1.4% in just the last three months.

On a national level, home prices have not gone negative since mid-2023, a year after the Federal Reserve first brought rates up from zero, and mortgage rates moved sharply higher. From March 2022 to June 2023, the average rate on the popular 30-year fixed mortgage went from 3.9% to just over 7%, according to Mortgage News Daily.

But even then, prices were negative on a year-over-year basis for just a few months. It was nothing like the great financial crisis when home prices dropped 27% from their peak in 2006 to their trough in 2012, according to the S&P Case-Shiller National Home Price Index.

https://www.cnbc.com/2025/12/11/us-home-prices-negative.html