Wednesday, October 5, 2022
HomeEconomyFed's Powell: U.S. housing market heading for a 'correction'

Fed's Powell: U.S. housing market heading for a 'correction'

(Reuters) – Federal Reserve Chairman Jerome Powell said on Wednesday the U.S. housing market could experience a “correction” after a period of “red-hot” home price increases that kept many Americans out of home ownership.

“There is a big imbalance … house prices are rising at an unsustainable rate,” Powell said on Fed’s decision to raise its policy rate again One basis point. “What we need in the long run is a better alignment of supply and demand so that house prices can rise at a reasonable rate at a reasonable rate and people can afford to buy a house again. We may have to go through a correction in the housing market back to That place.”

The Fed’s rate hikes this year have had the biggest impact on the real estate sector, with sales slowing and prices down slightly. Housing inflation will remain elevated for some time, Powell said.

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