“The current problem related to the housing market is limited supply. Even before the onset of the pandemic, in 2019, there was a shortage of approximately 4-to-5 million housing units in America. That came about due to population and job growth that outpaced new-home construction. Then, the shortage worsened during the first year of the COVID-19 real estate boom as many desired to take advantage of the historically low interest rates. The shortage intensified when mortgage rates shot up due to homeowners who have been unwilling to list and give away their locked-in low rates. One future scenario is some calming in the economy and inflation. That will lead to modestly lower mortgage rates and more buyers will come to the market. Hopefully, homebuilders will ramp up production and we’ll continue to see the repurposing of empty commercial buildings into residential units. Home prices are not crashing in this scenario. Home price growth will depend on whether homebuilders can bring sufficient supply to the market. Another scenario is if we experience an economic recession when jobs are being cut. Those who lose jobs may be forced to sell their homes. Moreover, those uncertain about their jobs will not have the confidence to buy a home. However, a recession means much lower interest rates. And those with stable jobs – around 70% to 80% of workers – will want to take advantage of low interest rates. This scenario may cause home prices to rise faster, especially if some wealthy people decide to reallocate investments from the stock market to real estate. We will not have a repeat of the 2008–2012 housing market crash. There are no risky subprime mortgages that could implode nor the combination of a massive oversupply and overproduction of homes.”