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Published: Aug 17, 2022 5 min read
A Price Reduced For Sale Sign In Front Of A House

A lot can change in just a few months, and the housing market is no exception. After two years of intense competition spurred by ballooning demand, rock-bottom mortgage rates and soaring home prices, things are finally starting to return to a pre-pandemic version of normal.

"There's no doubt that the housing market has receded,” Ali Wolf, Chief Economist at housing market research firm Zonda, told CNBC this week, noting that the firm’s data is back to levels last seen in 2018 and 2019. “That’s dramatically slower,” Wolf said, “but that also captures a healthy and more sustainable pace of home sales.”

Most of the changes outlined below can be traced back, at least in part, to the fact that buying a home is becoming less and less affordable. Rising mortgage rates and two years of abnormal home price growth mean that buying a house is simply no longer possible for many. Add in the threat of a recession and persistently high inflation, and you have a recipe for a serious slowdown in demand.

Here are four signs that show how the housing market’s red-hot run is coming to an end — if it's not over already.