Housing Collapse? Not Likely

Experts are throwing cold water on a ‘housing collapse’

There’s no doubt that housing in the US has come under significant pressure over the past year. A lethal combination of rising interest rates and home prices – at a late phase in the economic cycle – has given way to weak mortgage-lending, climbing inventory, and a bear market in housing stocks.

Still, a handful of market strategists and economists taking the sector’s pulse are throwing cold water on fears of a severe downturn.

“Don’t believe the narratives of a housing collapse,” Bank of America Merrill Lynch economists led by Michelle Meyer told clients last week. “The sector is challenged but should only be a slight drag on growth.” 

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