The housing market’s supply problem and where the Fed fits in

On this podcast episode of Stocks In Translation, Yahoo Finance’s Alexandra Canal and Sydnee Fried speak with Morgan Stanley US Housing strategist James Egan to discuss the state of the housing market, high mortgage rates, affordability, and supply and demand.
They discuss the term “locked in” and how that has kept prices elevated. The lock-in effect occurs when homeowners do not want to sell their homes because the interest rate they received when they purchased the home is less than the current interest rate.
Egan talks about what could happen to the housing market if the US economy sees a hard-landing scenario, underlining the significance of the Federal Reserve’s own interest rate policies on the housing market. “From a hard landing perspective, I would expect as rates come down, I do think you’re going to see more inventory,” he notes.
Egan adds that mortgage rates “have to move a lot more significantly from 6.5%, 6.25% where they are now, in our mind, to really kind of unstick the housing market.”
Twice a week, Stocks In Translation cuts through the market mayhem, noisy numbers, and hyperbole to give you the information you need to make the right trade for your portfolio.
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