The housing market is on the brink of a dramatic turnaround after back-to-back down years, according to the National Association of Realtors (NAR).

US home sales are on pace to plummet about 18% in 2023, the NAR noted in a recent report, which would be the biggest drop in at least 15 years. Fewer than four million houses will change hands for the first time since 2010, which was just before the recovery from the financial crisis.

Prospective buyers were pummeled by the highest mortgage rates in decades. The rate on a 30-year fixed mortgage peaked near 7.8% in late October as interest rates skyrocketed.

Surprisingly, weaker demand didn’t bring down home prices meaningfully, the NAR found. Instead, sale values kept increasing since there simply weren’t enough houses on the market, which added insult to injury for financially stressed buyers.

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Source: Business Insider

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