What would cause a 20% drop in housing prices within 1-2 years?
What would cause a 20% drop in housing prices within 1-2 years?
A sudden 20% drop in housing prices within 1-2 years could be driven by several factors, including a significant economic downturn or a major shift in interest rates. A recession could lead to job losses, increased foreclosures, and a reduction in consumer confidence, all of which could drive home prices lower. Additionally, a sharp rise in mortgage rates could make borrowing less affordable, reducing demand for housing. Overbuilding, where too many homes are constructed relative to demand, could also flood the market and force prices down. Finally, tighter lending standards or changes in government policy affecting the housing market might also contribute to a sharp decline.