Redfin Sees U.S. Housing Costs Normalizing in 5 Years if Mortgage Rates Fall to 6%
Updated
Updated · Fox Business · Oct 12
Redfin Sees U.S. Housing Costs Normalizing in 5 Years if Mortgage Rates Fall to 6%
3 articles · Updated · Fox Business · Oct 12
Summary
Five years is Redfin’s base-case timeline for U.S. housing costs to return to “normal” if mortgage rates drop to 6% and home prices keep rising at roughly 2.1% annually.
Redfin says normalization would come mainly from incomes catching up as price growth cools, not from a sharp drop in home prices.
6% rates with flat prices would bring normalization by February 2029, while 6% rates and 2% annual price declines would pull that forward to May 2028.
7.5% mortgage rates with flat prices would stretch the timeline to about six years, and 7% to 8% rates with 2.1% price growth could push it to 10 years or more.
San Jose, Austin, Oakland, Seattle and Portland could normalize fastest, while about half of metros—including Boston, New York, Chicago and Milwaukee—may need at least a decade.