in 2023 and well into 2024. my opinion, not part of Wells Fargo ‘s forecast, is that the 40% increase in prices during the 2020-2022 Covid bump is going to get wiped out first. And very soon. Many others think the same. It was irrational and not based on any fundamentals. Driven by Buyer crazy emotions And super low rates. The driver for the precipitous drop is mortgage rates which are, today, nearing 8% for a 30 year fixed. More buyers are using ARM loans now, ( adjustable rate mortgages) what could go wrong there? The Fed is committed to destroying real estate, of that, they have left no doubt. How many will walk away from their, suddenly, underwater home? If history is a barometer, it will be a lot of people going into strategic defaults. The only way to compensate for the huge increase in rates is to drop prices. As of today the monthly mortgage payment on the average house in California using todays 8% rate has gone up by about $3200 a month versus the same house in April at 3%. $3200 MORE. Thats crazy. It’s going to be a great time to pick up properties cheap. If you’re into that sort of thing.
