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More homes on languishing on the market without any buyers, setting up prices to start falling as soon as this summer, according to Brian Nick, senior investment strategist at Macro Institute.<\/p>\n
In fact, the year-over-year percentage increase in unsold existing homes for sale is the highest since the Great Financial Crisis, he told Bloomberg TV <\/a>on Thursday.<\/p>\n \u201cThat\u2019s going to put downward pressure on prices in the next three to six months,\u201d he predicted.<\/p>\n For now, the housing market is still in its traditional spring selling season, when Americans typically shop for homes while families try to secure a new dwelling before the start of the next school year.<\/p>\n By some accounts, this season is a disappointment<\/a> so far as the increasing supply of homes has been met with tepid demand from buyers who are revolting against on high prices.<\/p>\n And when the selling season winds down in the summer and heading into the fall, Nick said home prices will start to drop and erode consumer confidence. While high prices have demoralized prospective buyers, they have buoyed sentiment among the owners of those homes along with the strong labor market.<\/p>\n \u201cOnce they start seeing housing prices falling\u2014maybe the home next to them going for a little bit less than asking as opposed to what they\u2019ve been seeing the last couple of years\u2014that will dent their ability to spend and their willingness to spend as well,\u201d he warned. \u201cThe housing market is really the first domino to fall on what we think is going to be a slower growth story down the road.\u201d<\/p>\n Other housing market watchers have also pointed to a shift, with more buyers pushing back<\/a> against the high home prices that sellers are demanding.<\/p>\n Compass<\/a>\u00a0cofounder and CEO Robert Reffkin told\u00a0CNBC<\/a> last month\u00a0that 30% of the inventory on the market has seen a price drop, more than anytime in last decade, with supply up 16%.<\/p>\n \u201cIt is a different environment. We are now seeing more sellers than buyers,\u201d he said.<\/p>\n But such weakness is still masked by nationwide numbers, which show home prices are rising. The most recent S&P\u00a0CoreLogic\u00a0Case-Shiller index<\/a> showed prices were up 6.5% in March from a year earlier, hitting a fresh all-time high. Separate data from Redfin<\/a> showed they rose 7.3% in April from the prior year.\u00a0<\/p>\n For his part, the Macro Institute\u2019s Nick noted that the number of existing homes for sale is now up 8%-10% annually, suggesting that prices will soon come down.<\/p>\n \u201cThat supply-demand imbalance is starting to correct, which could mean you start seeing lower prices as soon as this summer,\u201d he said.<\/p>\n<\/div>\nSubscribe to the CFO Daily newsletter to keep up with the trends, issues, and executives shaping corporate finance. Sign up<\/a> for free.<\/div>\n<\/div>\n