South Bay City's Housing Market Tops Crash Candidate List: Report

SANTA CLARA COUNTY, CA –One of the world's leading asset managers is predicting that a South Bay city's s real estate market is about to experience a 2008-style crash.

San José is among four frothy cities at particularly high risk of seeing property values plummet precipitously this year, according to a Goldman Sachs note to clients earlier this month obtained by the New York Post.

Austin, Texas; Phoenix, Arizona; and San Diego are the other cities likely to see declines of more than 25 percent, Goldman Sachs warns.

Rising interest rates aimed at curbing inflation are largely behind the expected fall in real estate prices, the note said.

“Our 2023 revised forecast primarily reflects our view that interest rates will remain at elevated levels longer than currently priced in, with 10-year Treasury yields peaking in 2023 Q3," the note said.

"As a result, we are raising our forecast for the 30-year fixed mortgage rate to 6.5% for year-end 2023 (representing a 30 bp increase from our prior expectation).”

Read more in The New York Post