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Thats led many would-be sellers to hang tight rather than list their home for sale, squeezing supply.
The median home price is around 5.2 times the median household income.
This ratio indicates housing affordability remains a significant concern.
The changes include doubling the standard deduction and cappingstate and local tax(SALT) deductions.
That in turn leaves middle-income families withlower net tax rates and more money to put toward buying a home.
Of course, that itself puts upward pressure on home prices.
Another tax rule of the TCJA almost certain to be extended is bonus depreciation.
It also incentivizes investors to buy dilapidated apartment buildings and improve them.
Trumps tendency toward deregulation will further lower the barriers to entry in the housing market by lowering building costs.
That should improve affordability, she said.
However, expected tariffs on imports such as building materials could cause a brief disruption to supply chain dynamics.
Weaker demand implies a softening or fall in rents and home prices.
Mortgage Rates
Hohman predicts higher mortgage rates to further depress home prices.
Pro-business policies are good for the stock market, and when stocks go up, bonds traditionally fall.
Lower bond prices mean higher yields, which drive up mortgage rates, he said.
I expect home prices will fall dramatically in 2025.
Stauffer also hones in on mortgage rates.
Ideally, wed need rates around 4% to ease the lock-in effect were seeing, she noted.
Lowering rates would boostbuying and sellingactivity which would make a huge difference in the market.
People may need to accept that rates could stay where they are for a while.
First-time homebuyers and renters would welcome more affordability, while homeowners and investors would lose money.
Not everyone foresees softening home prices or rents.Goldman Sachsforecasts 4.4% appreciation in home values next year.
The proverbial grain of salt: they made that prediction before knowing the outcome of the election.
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