Many experts predict that housing inventory will enter the market, allowing supply to meet demand. It’s unclear whether this is quite the supply shock needed to cause a housing market crash, but it could certainly stabilize or reduce prices.
At this point, you might be wondering what’s in store for the rental market. So far, it’s kept up with price increases elsewhere in the economy faster than house prices as a whole, and rent in the US has reached an all-time high.
It’s tough to know which conclusion individual investors will reach, and there’s likely to be some diversity of opinion. Some may consider real estate a hedge against inflation, but others may get spooked and pull out, completely dampening demand further.