Rising in conjunction with mortgage rates are home prices, putting prospective buyers out of reach. The latest data from the National Association of Realtors showed that the Quarterly Housing Affordability Index has been dropping thanks to a rise in median home prices.
As such, real estate activity has slowed, but with the market being neither a seller’s or buyer’s market, this type of relative inactivity when compared to a whipsawing stock market could be exactly what investors are looking for. Lately, a flight to short-duration bonds has been the default maneuver in terms of seeking refuge from the U.S. equities roller coaster ride, but real estate could also present itself as a plausible safe-haven opportunity.
Thus, a silver lining could be had in housing if a U.S.-China trade deal doesn’t prove to be the catalyst to recharge stocks through 2019.
“Because there’s a scarcity in inventory in housing market, it should keep prices stable and maybe modestly growing higher,” Leon said.
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