Goldman Sachs forecasts continued decline in U.S. housing market activity

Goldman Sachs economists have predicted that the US housing market will stay weak until at least 2027. The main problem is that mortgage rates have been above 7% for three years, making homes very expensive to buy.

Many homeowners locked in low rates around 2020 and 2021. Because of this, they do not want to sell and take on a higher rate. Goldman Sachs says that for every one percentage point difference between old and new rates, the chance of selling falls by 18%.

The bank expects only 3.9 million existing home sales in 2027. That is 26% below 2019 levels. Despite fewer sales, the average home price reached a record $446,400 in June 2026. Goldman Sachs also predicts prices could fall 5% to 10% from that peak.