Zillow projects that U.S. home prices will fall 1.7% between March 2025 and March 2026. Last month, Zillow economists still thought prices would rise this year.

The US Housing bubble has popped.

Everyone remembers how well that went last time, right?

  • Libra00@lemmy.world
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    27 days ago

    I remember a year or two before the 2008 crash watching a video someone had made where the housing market was modeled as a roller-coaster that you got to ride on, and toward the end it was just going up and up and up until it was miles above where it had been. And the comments were like ‘It’s gotta come down sometime, right? It can’t keep going like this?’ Yeah, they were off on their timing, but not about the prediction in general. As soon as we started seeing articles about the high cost of living and the housing crises in cities around the country and even world I started thinking about that roller-coaster again.

    • Libra00@lemmy.world
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      27 days ago

      The housing market almost never goes down year-over-year, so it’s reasonable to assume that when it starts to it signals big trouble in the future.

        • sp3ctr4l@lemmy.dbzer0.comOP
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          27 days ago

          He probably meant that it almost never goes down in nominal, ie, non inflation adjusted terms, yoy.

          What you have posted is:

          1. Not actual nominal prices, it is the case-schiller index, which is calculated with different weighting and methods than Zillow is using.

          2. This is inflation adjusted, real values, again, not nominal prices.

          3. Looks like this is a data point at each month, when we are talking about blocking out and aggregating entire years and representing them as one data point.

          When looking at more granular data, you’re more likely to see more movement. When you’re looking at less granular data… a projected yoy decline is a much bigger deal.

          Thats a lot of words to say: You are not doing an apples to apples comparison.

          That would look like this:

          Apologies for whipping up this shit tier graph from FRED, im on a shitty phone.

          Orange or Rust is actual nominal prices, blocked out year by year.

          Blue is the nominal change in yearly prices, I would have liked to made it a centered % change graph in the middle, but FRED doesnt do that in its web renderer.

          But you can still see any time the blue is… below zero.

          And that is, historically, pretty rare, only happening in 7 (or 8?) years of nearly a century of data.

          • tal@lemmy.today
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            27 days ago

            Yeah, I suppose that’s fair. He was specifically using it in the context of illustrating whether-or-not this figure was bad or not.

            I just have a knee-jerk irritation reaction when I see people saying “the housing market always goes up”, because it’s usually in conjunction with someone advising someone to put a ton of money into real estate, where the graph I provided is a more-relevant one.

      • Vent@lemm.ee
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        27 days ago

        The housing market almost doubled prices during COVID. I don’t think it’s unexpected that prices would settle down and readjust in the years following.

        • sp3ctr4l@lemmy.dbzer0.comOP
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          27 days ago

          Except it is unexpected, if you ask basically 90% of realtors, and the vast majority of analysts following the housing market, untill… well basically right now.

          The whole schtick is that houses prices always go up, never down, that price growth may slow but never actually go negative.

          I pointed this out to my other reply to you, but uh yeah, the fundamentals have been blaring more and more warning signs for years, but perception is key, so the vast majority of people who report market projections are incentivized to paint a far too rosy picture…

          … And then reality becomes too difficult to ignore, and perceptions shift rapidly.

          Zillow, a month ago, was projecting a modest, nationwide growth of 0.8%.

          Now, a month later, Trump actually does the stuff he repeatedly said he was going to do, but the market just assumed he was either bullshitting or had a more robust and thought out plan…

          And suddenly the delusions are eviscerated, and a month later, 0.8% gets moved downward -2.5% to a -1.7% projection.

          These people did not see this coming until it smacked them in the face.

          Almost no one was projecting an actual decline, publically, untill very recently, and if you were projecting a decline 6 months ago, you would have either been dismissed or laughed at by the experts.

    • sp3ctr4l@lemmy.dbzer0.comOP
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      27 days ago

      Yes.

      The bubble pops when the price growth stops, and goes negative.

      ‘The bubble’ is basically the idea that prices just keep going up forever.

      Based on that idea, financing, loans, leverage happens.

      When the fundamentals no longer represent the bubble mindset, everyone whose personal budgets or business relies on prices just going upward, forever, are now margin squeezed, and potentially margin called depending on how overleveraged they are… because you based your ability to pay the debt on your loans you used to purchase the property… on the idea that your property and thus rent prices would just keep going up.

      Now, your property is actually worth less, and thus so is the amount of rent you can charge… but your debt payments are still the same.

      You hold out as long as you can, but all around you other property owners are cutting their losses and selling at lower property values, which further reinforces the idea that your own property isn’t worth the rent you are charging for it.

      EDIT:

      There are a lot of underlying fundamentals that drove Zillow’s projection, which are broadly addressed in the article.

      But it is also worth mentioning that a single month ago, Zillow was projecting a modest 0.8% growth for the year forward.

      Then Trump decided to greatly aggrevate the economic situation, and things downturned so fast that 0.8% growth turned into -1.7%.

      The fundamentals have been building up to a breaking point for a while now, huge inventory numbers, much more time on market till a sale, sellers offering many kinds of concessions, significant lossess in the stock prices of major homebuildets…

      But then Trump did the Tariff nonsense, and also decided to deport all the brown people to a gulag, cause an overt constitutional crisis, and destroy the USD as the de facto world currency… and in doing all thjs, he essentially popped the bubble himself.

      Trumps actions in one month shifted the growth projections for a whole year by -2.5%.

  • Blackmist@feddit.uk
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    27 days ago

    Don’t be thinking this means housing is about to get more affordable.

    It means borrowing is about to get a whole lot more expensive.

  • Naich@lemmings.world
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    27 days ago

    You wish. As long as housing is seen as an investment, there will be enough people buying to keep the prices going up.

    • bobs_monkey@lemm.ee
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      27 days ago

      I live in a ski town, which is a second home market. Houses are surging onto the market right now as people are wanting their capital liquid, and prices are softening quickly as people get desperate to offload these rental houses when absolutely no one wants to buy at the moment. Our vacation rental market reached peak saturation a year or so ago, and now it’s a losing battle for many, especially considering we had two bunk winters in a row and owners lost their asses.

      I don’t expect houses to return anywhere near where they were before COVID, but I’m optimistic they’ll become semi affordable in the next year or two. I’m just tired of renting and facing the prospect of moving because a landlord gets a wild hair up their ass.

    • sp3ctr4l@lemmy.dbzer0.comOP
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      27 days ago

      Its not me doing the wishing or future predicting here.

      It is Zillow.

      They have the largest, most comprehensive, and most frequently updated database of information on US home prices… basically, in existence.

      They are saying you are wrong.

      Not me.

      Worth noting that the -1.7% figure is … nationwide, amalgamated.

      There will be areas that keep appreciating, areas that stay flat… but many, many more areas that will depreciate.

  • JohnnyFlapHoleSeed@lemmy.worldBanned from community
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    27 days ago

    Yup, the real pop will most likely happen between fall 2025 and summer 2026. Been sitting on my cash, saving up since dip shit got ‘elected’. Hopefully he doesn’t drive up inflation so much that it cancels out the 15-40% drops we’ll see in home prices. It’s also possible that private equity starts snatching up homes which could stabilize prices somewhat

    • sp3ctr4l@lemmy.dbzer0.comOP
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      27 days ago

      Hopefully he doesn’t drive up inflation so much that it cancels out the 15-40% drops we’ll see in home prices.

      Well uh… unfortunately:

      So thats about an 11% devaluation of the dollar since start of the year, where the dxy is an index based on the volume of currencies exhanged for the USD.

      And uh… yeah, we … actually still need to import a lot of shit… so… uh…that line looks pretty steep down, not done sinking yet…

      Fucking, who knows?

      Oops, God Emperor Trump turned out to be a false Messiah, and is actually somehow a thrall of all the Chaos Gods simultaneously.

  • Gordon Calhoun@lemmy.world
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    27 days ago

    I saw this movie! Are those damn immigrants, teachers, poors, and that one guy who served time for causing the Global Financial Crisis back at their old tricks?

    I hope tathtub Margot will be in the sequel, too!