Mortgage Rates Bite Housing Market Amid Seasonal Soft Window

The U.S. housing market, which had achieved stability after a mild price correction, is now facing the reemergence of a familiar threat as mortgage rates ticked up to 7.13%. This sudden resurgence prompts concerns about a resumption of month-over-month home price declines, particularly as the market enters the historically subdued fall and winter. Housing economists are divided on whether the uptick in mortgage rates puts the housing market at risk for further declines, with some expecting national house prices to decline enough in the second half of 2023 to wipe out gains from the first half, while others believe prices have bottomed due to the shortage of homes for sale.