Yale economist Robert Shiller, who has accurately identified stock market and housing bubbles in the past, recently cautioned that the housing boom spurred by the coronavirus pandemic may be poised for a downturn.
More broadly, Shiller, speaking to Yahoo Finance, cited several factors indicating the potential for a recession, including the ongoing pandemic, reawakening inflation fears and mistrust of what the Federal Reserve will do with interest rates.
"We have a lot of the ingredients that might lead to a recession," he said.
Home prices, up roughly 40% nationally over the past two years, haven't fallen since the 2007-2009 recession, Shiller told the news outlet earlier this month. "Right now things look almost as bad."
While home prices in May were up nearly 20% year over year, Shiller said, "It's not necessarily a bullish indicator."
National Association of Home Builders statistics on traffic of prospective buyers, a housing market index component, "has fallen off a cliff since just a few months ago. The talk is really negative," he explained.
"Existing home sales have gone down, permits are down. There's a lot of signs that we'll see something. It may not be catastrophic but it's time to consider that," Shiller said.
