Name: WTF Just Happened To The Housing Market?!
Uploaded: 2026-03-25T21:33:38.000Z
Duration: 16 min 6 s
Description: Thousands of YouTube videos with English-Chinese subtitles! Now you can learn to understand native speakers, expand your vocabulary, and improve your pronunciation...

For the first time in almost 20 years, the housing market has started to fall.

47 out of the top 50 cities are getting weaker, listing prices are now lower than they were in 2024, and

over the last few weeks, searches for "can't sell a house" and "help with mortgage" just hit an all-time record high.

Now, seriously, if you don't believe me, home sellers are now outnumbering home buyers by more than 600,000.

Mortgage rates are quickly going back up,

and the average home is now taking the longest time to sell in over a decade.

That's why we need to talk about exactly what's happening throughout the entire housing market, how higher interest rates are completely destroying demand across the country, where prices are headed throughout the rest of the year, and

then finally my own thoughts about what's going on.

Because real talk, this is exactly the type of market where some of the best deals could be made, if you know what to look for.

Although before we start, if you appreciate videos like this where we just cover the facts and I literally cite every single source in the pinned comment of this video, it would mean the world to me if you hit the like button or subscribe if you haven't done that already.

I know it's annoying for me to ask all the time,

but it costs you $0 down and as a thank you for doing that, here's a picture of a snail.

also a big thank you to Rocket Money for sponsoring this video, but more on that later.

All right, now in terms of where we currently stand, I've got to say the numbers are pretty wild.

First of all, it's important to realize that any time you see one of these dramatic headlines about the housing market, most of the data is already outdated by the time you see it.

For example, the headlines today are often based on deals that were agreed to weeks or even months ago under completely different conditions than what buyers and sellers are currently facing.

Like, you might see that home prices were up 0.3% from a year ago,

but that data was pulled in December and doesn't take into account rising mortgage rates, price cuts, and

Because those are the signals that actually tell you where the housing market is headed.

And when it comes to that, as of right now, mortgage rates are back to their highest level in three months.

37% of home builders are dropping their price by an average of 6%,

and as a result, homes are taking the longest to sell in over a decade.

Of course, it's important to mention that not all markets are created equal.

Because while sellers are panicking in places like Miami, where there's 197% more sellers than buyers, or Austin at 124%, other areas are seeing the exact opposite.

Cities like Milwaukee and Newark still have more buyers than sellers, pushing prices higher.

So the real question is, why is that happening?

Well, home prices are currently growing the fastest where they're the most affordable compared to incomes.

And when you could still buy a house throughout the Upper East Coast for around $400,000, it's going to attract a lot more people to the point where prices creep up.

Although in terms of the largest increase to home prices in 2026, it's probably not what you're expecting,

So here's the thing, even though oil prices seem completely unrelated to the housing market, in reality there's a lot more of a connection than most people think.

For example, when oil is pushed above $100 a barrel and people pay more than $5 for a gallon of gas, investors demand higher returns on long-term bonds, which pushes up the yield of the 10-year Treasury, and

mortgage rates rise right alongside with it.

This is why today the market has begun to price in the chance of a rate hike occurring as soon as April.

And if this happens, affordability is fi all right, to put this into perspective, a 1% increase in mortgage rates generally reduces a buyer's purchasing power by 10%.

So a $500,000 home at 6% would have the same affordability as a $450,000 home at 7%, suggesting that the higher mortgage rates go, the more home prices will need to fall to balance it out.

But that's still not the entire picture, because there's one more impact of higher oil prices,

Like, to give you an idea of how severe this is, aluminum is up 39% over the last year, steel is up 20%.

And that cost doesn't just get absorbed by the builder, it gets passed on to the buyer.

Look, all of that is to say that higher oil prices immediately affect home affordability.

And when that happens, we see two outcomes.

One, buyers wind up paying more for a home due to higher rates during a time where affordability is already impacted, or two, prices have to come down accordingly to compensate.

And if you want to hear something crazy, this is where the math gets absurd.

At today's 6.25% mortgage rate, buying the median-priced home of $398,000 with 20% down is going to give you a monthly payment of $1,954 a month before property taxes, insurance, maintenance, repairs, which is probably another $500 to $800 a month on top of that.

But in order to qualify for that home, you need to make $106,000 a year, which means the average American family is already $23,000 short.

That's why if we see a 25 basis point increase in mortgage rates, which to put things simply is just one quarter of 1%, an additional 1.4 million potential buyers would be priced out of the market immediately.

And this gets actually way worse when you look at the income requirements.

When rates were at 4.22%, you'd need to make $67,000 a year to qualify.

At 5.22%, you'd need to make $75,000 a year.

At today's rate of 6.22%, that's $84,000 a year.

And at 7.22%, you'd need to make $93,000 a year.

This is also the reason that home prices don't just instantly fall.

and we don't really notice the cracks forming until it's too late.

So in terms of what's expected to happen over the next year, which markets are most impacted, and

my own thoughts about what's going on, you're going to want to hear this.

Although before we go into that, I've got to say the people who wind up getting the best opportunities at the biggest discounts are usually the ones who get really good at one thing,

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Thank you so much, and now let's get back to the video.

All right, so in terms of the housing market, which areas are impacted the most,

and what this means for the rest of the year, let's discuss the absolute boogeyman of home prices,

They just see the headline number, read that median prices have increased another 0.3% over the last year,

and think, "Oh, this proves that home prices only keep going higher." Except when you account for inflation of 2.4%, that home didn't actually get more expensive.

Instead, it lost 2.1% in terms of purchasing power,

and that is what's now becoming incredibly common throughout the United States.

To put that in context, for the first time in years, wages growing at 3% to 4% in 2026 is actually outpacing home price growth, and

the difference between what you earn and what a home costs is finally beginning to narrow.

Now, in terms of what economists call this, it's a real-terms correction.

And so far it's the healthiest way for an overpriced market to normalize.

Like, instead of a dramatic 30% crash that wipes out decades of equity, home prices just trade sideways while incomes begin to improve.

No one panics, no one's forced to sell, it just flatlines while incomes gradually improve.