Moody's: Housing Correction Coming



Moody’s: Housing Correction Coming


Moody’s: Housing Correction Coming – but No Crash The Fed’s interest rate hikes will cause the "pendulum to swing back down" some places, but no crash if vacancies stay low and underwriting standards remain high. Moody’s Analytics Chief Economist Mark Zandi predicts that the latest Federal Reserve interest rate hike will cause a housing correction across the United States – but there won’t be a housing crash. He suggests that the Southeast and Mountain West are the most overvalued housing markets, and the pendulum will swing back down. There’s no sign of subprime or negative amortization activity that precipitated the foreclosure crisis during the Great Recession. That’s when you get crashes, when you have lots of foreclosures and a lot of distressed sales.