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As notions of a housing recession grow some very real horns, its important to understand the mechanisms that prevent such an occurrence, despite the growing relevance. In fact, according to the S&P Case-Shiller Index, home values were down 2.6% between June and September of 2022. It's hardly a secret that real estate prices across the country have been skyrocketing. Housing market predictions for 2022 | Rates, prices, inventory Some believe homes could be subject to a sharp price pullback in response to rising lending rates. A major reason is the steady climb in mortgage interest rates, fueled in part by the Federal Reserves decision to raise rates multiple times across 2022. Theres a chance they could also save by getting a house and locking in a rate before both rates and home prices increase. But more often, they represent a cooling of the market and a pushback on home prices. Overall the predictions for the next five years are that home price appreciation is likely to range between 15 and 25%, but they will be uneven. . Bubble burst risk: Canadian home prices predicted to fall by 24% Salmanson, CEO of real estate data firm Cherre in New York City, notes that we are seeing fewer transactions and increasing days on the market, indicating a price gap between buyers and sellers. The 1873 stock market crisis is a perfect example. History tells us that this is temporary: People are losing their jobs while still carrying mortgages at variable rates. Opinion: How does our current economy compare to previous recessions? The number of potential homebuyers is plentiful, with Americans who are either Millennial-aged or younger making up half of the U.S. population, or 166 million as of July 2019. editorial integrity, Lets take them into consideration before we review the cities which have been hit the hardest. By 2006, home buyers who'd taken out adjustable-rate mortgages saw their payments go up -- some by 60%. Murmurs of a recession have breached the surface of whats otherwise been described by many observers as a strengthening economy. Inflation started rising last year, setting off alarm bells as consumer prices began to climb. How far will they fall? Seventy-eight percent of community bank executives expect US housing to crash by 2026, a survey showed Wednesday.