Will the Housing Market Bounce Back?

Historically speaking, the housing market has always bounced back. It’s really just a question of what an investor’s time horizon is with respect to when a recovery is likely.
Those hoping for a housing market recovery before the end of 2022 may be disappointed. From a seasonality perspective, November and December tend to be low-volume months for housing sales. Accordingly, with house prices on the decline relative to their average high of $413,800 in June (around $384,800 in September), it’s unlikely that we’ll see an uptick in housing prices before the end of the year.
Inflation may be moderating. That said, with house prices still 8.4% higher on a YOY basis, the Federal Reserve may also decide to keep its foot on the economic brakes.
The housing market is also regional in nature. Accordingly, while most statistics are shared on the national level, certain cities and jurisdictions could see outsized losses relative to others. Thus, for certain markets, perhaps a year-end recovery could be in order, if mortgage rates continue to dip.
For most investors, though, the real estate space looks less-attractive than it has in some time. As with stocks and other investments, being patient is key. A recovery will happen. Just maybe not in 2022.