Top Investment Bank Projects 4 U.S. Cities Will Suffer A 2008-Level Crash In Home Value
Goldman Sachs Recently, the company informed its clients that home values are expected to fall in four major U.S. cities due to worsening economic circumstances.
According to the investment bank, San Jose, California, San Diego, California, Austin, Texas, and Phoenix, Arizona could experience a crash similar to the 2008 housing crash.
Fox News reported These cities may experience market crashes that are worse than 25%.
“Our 2023 revised forecast primarily reflects our view that interest rates will remain at elevated levels longer than currently priced in, with 10-year Treasury yields peaking in 2023 Q3,” Goldman Sachs stated this in a report. “As a result, we are raising our forecast for the 30-year fixed mortgage rate to 6.5% for year-end 2023 (representing a 30 bp increase from our prior expectation).”
“This [national] decline should be small enough as to avoid broad mortgage credit stress, with a sharp increase in foreclosures nationwide seeming unlikely,” The report has been updated. “That said, overheated housing markets in the Southwest and Pacific coast, such as San Jose MSA, Austin MSA, Phoenix MSA, and San Diego MSA will likely grapple with peak-to-trough declines of over 25%, presenting localized risk of higher delinquencies for mortgages originated in 2022 or late 2021.”
Goldman Sachs said that home prices are also expected to take a small hit in New York City and Chicago. Small gains were expected in Baltimore and Miami.
The report included, “Assuming the economy remains on the path to a soft landing, avoiding a recession, and the 30-year fixed mortgage rate falls back to 6.15% by year-end 2024, home price growth will likely shift from depreciation to below-trend appreciation in 2024.”
" Conservative News Daily does not always share or support the views and opinions expressed here; they are just those of the writer."
*As an Amazon Associate I earn from qualifying purchases
Now loading...