Source: Axios — 

The housing market has returned to earth. Home sellers can’t just name a price and expect buyers to pay; meanwhile over a trillion dollars in wealth in the form of home equity has evaporated.

Why it matters: Think of this less as a crash and more as a correction. The pandemic-driven housing boom was a bonkers moment of real estate demand.

• The Federal Reserve raised rates and crushed that demand, as intended.

State of play: During the pandemic boom, houses were selling for more than list price. A “historically unusual” situation, says Nicole Bachaud, senior economist at Zillow.

• Sellers are now accepting less than list prices, on average, to make sales, a return to pre-COVID trends.
• Experts say this is a return to normal in a lot of ways, even though 7% mortgages feel abnormal. “It’s a really awkward phase of the market because we’re coming off of this pandemic frenzy,” says Bachaud.