Housing could become affordable again without prices collapsing. That is the claim in a Redfin analysis released in early October. The catch is the timeline, which swings from about two years to a decade or more depending on mortgage rates, price growth and where you live.
The mechanics here
Redfin’s argument is about the gap between what homes cost and what people earn. “We don’t mean prices are just going to fall off a cliff,” chief economist Daryl Fairweather told FOX Business. Incomes keep rising while price growth cools, and the gap narrows.
The scenarios, as reported:
If mortgage rates fall to 6% and price growth holds steady at about 2.1%, costs could return to normal in the next five years. If rates fall to 6% and price growth flattens, Redfin puts the date at February 2029. Add a 2% annual price decline to that, and it moves up to May 2028. If rates stay near today’s 7.5% and growth flattens, the wait is about six years. And if rates stay between 7% and 8% while prices keep rising at 2.1% a year, normalization could take ten years or longer.
Follow the money by metro
National figures hide wide differences. Redfin lists San Jose, Austin, Oakland, Seattle and Portland, Oregon as the markets closest to normal. About half of the metro areas it analyzed could need at least a decade, including Boston, the New York City area, Chicago and Milwaukee. Markets where prices are rising faster than the national average face the same long wait.
Fairweather was frank about what that means for people waiting to buy. “That’s not a quick fix, and it won’t feel like one for buyers who are stuck waiting right now,” she said. Her advice: don’t try to time the market. A buyer who finds an affordable home and plans to stay a while shouldn’t let headlines scare them off. And for those who can’t buy yet, she said, “the trend is on your side.”
