Since the financial crisis of 2008, many Americans have opted to rent their homes rather than purchase them.
"Demand is shifting. It seems like we have a new urbanization," Nobel laureate economist
Robert Shiller told CNBC. "People are not so interested in these houses they [homebuilders] have built in recent years. There's more interest in renting."
To be sure, there's not a wild swing toward renting, the Yale professor said. "Let's not exaggerate. The American dream was a car and house. That will continue. On the other hand, America is an outlier on that dream. There's a lot of common sense in support of renting and taking public transportation."
Bottom line: "I'm suspecting it won't be a hugely dramatic trend, but will be a trend."
Meanwhile, the S&P/Case-Shiller index of home prices in 20 cities rose 5.6 percent in the 12 months through August, the smallest increase since November 2012.
"I've learned over the years forecasting home prices that the latest month is very important, but the trend is also important ... so what we've seen nationally is big increases a few months ago and now a softening," Shiller added. That "suggests price declines might be coming," especially in bubble markets like California, Shiller said. But it's also possible prices won't change much, he said.
Some experts remain cautiously bullish on home prices. "We're going to see a slower pace of increase, prices still going up, but at a slower pace, and that will help pull some of that sideline demand in," Lindsey Piegza, chief economist at Sterne Agee & Leach, told
Bloomberg.
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