Supply and Affordability Forecast: Improving Marginally with Moderate Changes Ahead

House prices are expected to remain relatively flat this year. Affordability has stopped deteriorating and supply is at a 40 year low. While supply is unlikely to increase significantly, affordability is also not expected to worsen. The housing market is projected to move sideways, with year over year growth anticipated in the second half of 2023. Existing home sales and housing starts are predicted to be down 10-15% for the year, but there has been a significant improvement compared to the first five months. Home prices will stay negative year over year for a few months but will become flat by the end of the year. New home sales, however, are expected to show year over year growth due to limited inventory in the market.