When Will the Housing Market Crash?

The only people predicting a housing crash are broke millenials and zoomers desperate for one, because they think it's the only way they'll ever be able to afford a home, despite even a 20% drawdown in median home prices still being well above pre-pandemic levels: https://fred.stlouisfed.org/series/MSPUS

The fact that so many people desperately WANT a housing crash is a pretty good sign that there won't be one, since that's indicative of massive pent-up demand.

Also the secularly low interest rates so many home buyers locked in before and during the pandemic.

Lots of optimism in the comments. There's definitely some risk bubbling up that's being noticed, such as this article from the WSJ today:

"Houston Apartment Owner Loses 3,200 Units to Foreclosure as Multifamily Feels the Heat

...

Applesway was typical of commercial-property investors who saw big profits in the prospect of acquiring moderately priced buildings and raising rents after making certain improvements. Chief Executive Jay Gajavelli said in a video posted online that he could double his investors’ money by sprucing up a lower-income apartment complex located outside central Houston, with a plan to raise rents and charge tenants extra fees for amenities.

“The property value will go up down the road,” he said.

Most of Applesway’s loans originated in the second half of 2021, just before the Federal Reserve began its campaign to raise interest rates. At one property, the interest rate on Applesway’s loan had risen from 3.4% to around 8%, according to loan information obtained from data firm Trepp Inc. At least two of the properties were financed with about 80% debt, which is considered high leverage in commercial real estate.

Some other large investment firms have had payment issues with floating-rate multifamily loans in recent months. Veritas, a San Francisco private-equity firm, defaulted on a $450 million loan backed by rent-controlled apartment buildings, and Blackstone Group is negotiating with its lender over the debt on a portfolio of New York City apartment buildings.

...

"

And finally:

"Foreclosures such as that of Applesway in Houston are rare, but they could become more common as loans come due and hedging contracts that protect landlords from rising interest rates start to expire. A record $151.8 billion in U.S. mortgages backed by rental apartment buildings are set to expire this year, and $940.1 billion are set to expire over the next five years, according to Trepp."

Right after you buy.

The housing market can remain irrational longer than your marriage can remain solvent.

(Joking about the human pressures that are hard to ignore)

Crash? There's still a shortage. Price declines are driven by changing demand following covid and interest rates going up. I suspect the mortgage for a home in Omaha is about the same now as it was in 2019.

It is declining. Hopefully it won't crash just settle over the next 7 years.

When the PE firms with giant commercial real estate portfolios default or dump.

People have been asking this forever. Except for 2006-2010 and briefly in 2020 odds are housing will go up . I would bet on it continuing to go up.

It’s declining quickly so perhaps it already has but prices are sticky and don’t move down more than 15-20 % a year