Source: Forbes —
Federal Reserve Chair Jerome Powell views the U.S. housing market as “very overheated” after the pandemic, and he believes supply and demand need to get back into balance.
Powell spoke at a November 2 press conference as the U.S. Federal Reserve Committee, which he chairs, raised rates 0.75 percentage points to fight surging inflation. That could raise mortgage costs further, after they have already risen substantially in 2022. Powell’s actions and comments were not positive for housing.
Lower Risk
Powell doesn’t see parallels to the great financial crisis because lending and credit standards for mortgages are now much higher in the Fed’s view than during the financial crisis. So Powell believes fallout from a weaker housing market for the broader economy market may be lower.
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