Plain English with Derek Thompson The Housing Recession Is Coming
Sep 15, 2022
Mark Zandi, Chief Economist at Moody’s Analytics, shares expert insights on the struggling U.S. housing market amid rising interest rates. He discusses the imminent correction and its potential impact on the broader economy. Zandi highlights critical trends in over 200 housing markets at risk of price declines and compares current conditions to the 2008 crash. Additionally, he explores the synchronized global housing market decline and how China's economic turmoil reverberates through the U.S., revealing interconnected risks and opportunities.
AI Snips
Chapters
Transcript
Episode notes
Rent Inflation Discrepancy
- Official government data suggests that rent inflation is still accelerating, contradicting reports from sites like Zillow that show peaking rent prices.
- This discrepancy arises from the Bureau of Labor Statistics' survey methodology, which causes a lag in reported rent increases.
Housing Market Correction
- The U.S. housing market is experiencing a correction, not a crash, with nationwide price declines expected.
- High mortgage rates combined with high house prices are making homes unaffordable, leading to decreased sales.
At-Risk Housing Markets
- Over 200 housing markets, primarily in the South, Texas, and Mountain West, are at risk of price declines.
- These areas experienced significant price increases during the pandemic due to low rates and remote work trends.