Ingo Winzer, of Local Market Monitor, has made some very good real estate predictions in the past. He developed a concept of Income Prices, which proved highly accurate in assessing real estate risk during the last two economic cycles.
According to him, in most markets, home prices will come down – or at best will stagnate for years. once a bubble gets going it takes on a life of it’s own. He states that, over the past year, the average home price increased 16%, or even 30% in some markets. This kind of increase is unprecedented and will end badly, as bubbles always do. He believes that, this time, the fall out will not be as severe as last time because it is not being driven by sub-prime loans.
He thinks that the home price bubble could easily continue for another year. This makes sense as there is a shortage of supply and the prohibition on foreclosures during the pandemic (along with supply constraints) put upward pressure on housing prices. New foreclosures take some time to work their way through the system.