"It’s got to be a two-step process," the CEO of Meredith Whitney Advisory Group told the Financial Sense Newshour podcast. "You have to have rates come down, but you also have to have home prices come down; one doesn’t work on its own." This highlights the dual necessity of lower interest rates alongside price reductions to revitalize the housing market.
"Housing transactions have stagnated in recent years as soaring prices and steeper mortgage interest rates have fueled an affordability crisis. Homeowners who locked in cheap mortgages are reluctant to sell and give them up, and prospective buyers are unwilling to pay top dollar for a worse house." This reflects the broader challenges facing potential homebuyers.
Whitney noted that while home prices rose by 3% in September, existing-home sales fell 3.5%, with first-time buyers consistently making up just 26% of sales—indicating a persistent stagnation and barriers in the housing market.
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