The firm wrote to clients earlier this month that it predicts four U.S. cities will suffer the most catastrophic dips, drawing comparisons to the 2008 housing crash.
San Jose, California; San Diego, California; Austin, Texas; and Phoenix, Arizona, will likely see noticeable increases before drastic decreases of more than 25%.
These declines would be similar to those witnessed during the Great Recession in 2008. Home prices across the U.S. fell around 27% at the time, according to the S&P CoreLogic Case-Shiller index.
The bank says these cities will suffer the lowest prices this year because they became too detached from fundamentals during the COVID-19 pandemic housing boom.
Goldman Sachs also forecasts that many Northeastern, Southeastern, and Midwestern markets could see milder corrections.
Home prices are expected to dip slightly in New York City (-0.3%) and Chicago (-1.8%), while Baltimore (+0.5%) and Miami (+0.8%) will see higher prices, the firm said.
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