A Housing Market “Recovery” Is Further Away Than We Thought

The housing market isn’t going back to “normal” anytime soon. In fact, it could take significantly longer than many of us thought. Rates are around 7.5%, median home prices hover near $400,000, but your salary is not keeping pace. Something needs to change: is it rates, prices, incomes, or a combination of all three? I did the math and have an answer for how long it will actually take for the housing market to recover. So first, what does a “normal” housing market actually mean? We’re going to look at two data sets: 1989-2026 and 2019 levels, the last year before pandemic-fueled inflation started to boil the housing market. Back in 2019, Americans spent only around 15% of their income on housing payments; today, it’s nearly 25%. So, how do we return to a market where homes are actually affordable? I’ll walk through each scenario: wages rising significantly, mortgage rates falling, and home prices crashing, and then paint a picture of what happens if all of them (reasonably) move in the right direction. If someone is convincing you the market is about to get much cheaper, or much more affordable, or that you should just wait until it’s easier to buy…good luck. Click here to listen o...