Goldman Sachs Forecasts Four Years of Housing Market Stagnation

Goldman Sachs predicts that the U.S. housing market will experience a gridlock with minimal house price growth through 2026. The surge in housing demand during the pandemic, coupled with limited supply, led to a significant increase in home prices. However, the recent mortgage rate shock and strained affordability are placing downward pressure on prices. While tight resale inventory continues to push prices up, Goldman Sachs forecasts a slow grind upwards, with annual home price growth of +1.3% in 2023, +1.7% in 2024, +2.4% in 2025, and +3.8% in 2026. This would result in a total increase of just 4.5% above the pandemic peak achieved in June 2022 by the end of 2026.