US Housing Market Expected to Moderate Gradually
America’s booming housing market is expected to gradually but steadily run out of steam over the coming years, predicted the White House in a report on Monday.
Low mortgage rates have been largely responsible for the fast-growing housing market, which has in turn powered the economy and send real estate prices to record highs for the past five years running.
“A gradual slowing of homebuilding appears more likely than a sharp drop because the elevated level of house prices will sustain homebuilding as a profitable enterprise for some time,” the President’s annual economic report to Congress suggested.
Most private analysts seem to agree with this forecast of a gradual decline, and businesspeople are hoping that this is the case, as the growth can’t continue forever, and a sudden collapse would be very dangerous to the country’s overall economic outlook.
House prices are also expected to take a rest, and see much slower growth for the next couple of years at least, according to Matthew Slaughter of the White House’s Council of Economic Advisers.