The worst may be over for homebuyers

(CNN) – After the last few years of skyrocketing home prices and elevated mortgage rates, Americans have been feeling overwhelmingly dejected about their prospects of buying a home. But there are now signs that maybe, just maybe, the worst could be over for homebuyers. “June, in particular, has started to show the housing market slowing down in favor of buyers,” said Skylar Olsen, Zillow’s chief economist. Related Stories During the pandemic, families and remote workers rushed to find homes offering extra space, taking advantage of historically low borrowing costs after the Federal Reserve slashed interest rates to support the U.S. economy. While the Fed doesn’t directly set mortgage rates, its actions do influence borrowing costs throughout the economy. When the Fed began aggressively hiking rates again in March 2022 to battle historically high inflation, most economists expected housing demand to take a hit. High interest rates tend to decrease demand for homes, driving down prices. But something else happened. Demand for homes didn’t disappear; instead, more homeowners held off on listing their homes to keep their pandemic-era ultra-low mortgage rates. This, coupled with an existing housing shortage, caused home prices to surge even higher. For the past two years, potential...