For Wall Street, the housing market this year was hard to target and analysts often found their forecasts missing the mark.
Take Wells Fargo economist Charlie Dougherty, who in March expected home prices nationally to fall 4.5% this year. But by October — when mortgage rates were nearing 8% — Dougherty ditched that outlook and projected home values to instead gain 1.8% in 2023.
He’s not alone. Prognosticators at Morgan Stanley and Goldman Sachs along with economists polled by Bloomberg also found themselves playing catch-up when it came to prices, new home sales, and mortgage rates this year — often reversing directions from previous forecasts.
The revisions show that early on many underestimated the resilience of housing demand in the face of rising mortgage rates and didn’t fully realize the vise grip low rates had on potential sellers — affecting available inventory and…