Home prices continue to fall so hard that it’s tempting to believe they’ve either hit bottom or will do so soon. But some economists think home prices will remain depressed for a decade or more.
Fortune cites an analyst who says inflation-adjusted house prices could continue to plummet, thanks to a gloomy economic outlook, falling salaries and government spending cuts. Home buying is all about optimism — buyers need to be confident that they’ll remain gainfully employed and believe they’ll be able to make 30 years of regular payments, and since there are fewer buyers who are in such a position, demand for houses remains low.
Since the Depression-era housing market took 19 years to reach its previous peak, the economist reasons, it could take until 2025 for the current market to recover.
When do you think home prices will start rising again? And what are you doing to brace yourself from the poor market, or take advantage of it?
How housing could rebound — in 2025 [Fortune]