Why I believe the housing market is stabilizing, not slowing.

Many people are wondering if the housing market is slowing down, but I believe it is reaching more of an equilibrium, and there are a few reasons why.

First, it is important to note that interest rates have increased significantly. The Federal Reserve decided they needed to curb inflation because low interest rates prompted immense spending and borrowing. Raising the borrowing rate lowers inflation, so that’s what they decided to do.

However, because interest rates rose, buyers were pre-approved for less, and couldn’t afford the houses they once could. This eliminated a good pool of buyers, but at the same time, the supply was reacting to the previously high demand. Therefore, the supply started to catch up.

With an increase in supply and a decrease in demand, we see price stagnation and price reductions. That is why, in my opinion, the market is stabilizing, and at healthier levels than it once was.

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