Sanctions against Vladimir Putin and Russia are certainly going to have an impact on the global economy, but many have begun wondering what, if any, effect the crisis could have on the U.S. housing market?
Redfin Deputy Chief Economist Taylor Marr and the Redfin team looked at some likely scenarios and while the longterm market outlook remains unchanged since Russia invaded Ukraine, there may be some more immediate effects domestically.
For starters, plummeting stock markets could make it harder for homebuyers to pull together cash for a down payment. Many buyers rely on selling stock or tapping into their 401(k) for a down payment, and swings in the market generally could erode consumer confidence. Redfin notes that reliance on stock sales could have a particularly big impact in expensive tech hubs like the Bay Area, Seattle and Austin.
Additionally, rising oil, energy and gas prices could prolong inflation, which means the Fed has more reason to increase rates, further pushing mortgage interest rates higher and slowing homebuyer demand.
The conflict could, of course, also decrease Russian demand for U.S. homes. While not as much of a concern here out West, Redfin reports that Russians have historically purchased a fair amount of property in South Florida.