Zillow turns full-blown housing market bear—just look at its new forecast
fastcompany.com
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?
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.
I remember that one and seeing it at about that same point in time. It was very impactful.
However…
Indeed. I mean I certainly didn't believe them, but I didn't know shit about the housing market in like 2006 or w/e. Boy did that change. Now the Big Short is one of my favorite movies.
That's close, but the one I saw didn't have post-2008 data (14 years ago was 2011.) The one I saw was definitely pre-2008, and also I think it was a steel coaster not a wooden one, but that was a long time ago.
1.7% YOY decrease is a bubble popping?
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.
The housing market almost never goes down year-over-year
https://en.wikipedia.org/wiki/Case%E2%80%93Shiller_index
Case–Shiller home price index data, inflation adjusted, 1890–2018.
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When the fundamentals no longer represent the bubble mindset, everyone whose personal budgets or business relies on prices just going upward, forever, are now margin squeezed, and potentially margin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%.
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.
You wish. As long as housing is seen as an investment, there will be enough people buying to keep the prices going up.
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.
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.
Not the people being deported, or the people who work for a living whose savings are going to get devastated...
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
Private equity buying everything up is probally the “plan.”
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.
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!
Ohhh maybe I can afford a million dollar 2- bedroom fixer-upper soon!
I'm constantly pestered by flippers mailing me their postcards offering me "all cash, as-is" deals to buy my house for 20% under assessed value. Medium-sized PNW city that's seen a ton of appreciation due to 1) being relatively cheap to begin with, 2) having an airport w/OK connections to major coastal and SW cities, and 3) being perceived by outsiders as not having "big city problems" (very wrong). I wish these flippers would die, but if that won't happen I wonder if bubble-popping will significantly hurt their ability to prey on the desperate?
Going out on a limb here, but I'm guessing you are describing either Bellingham or Everett (or their sort of... basically attached, suburb cities)... in which case, my condolences, I've lived in both rofl.
I hear Tacoma finally stopped smelling like farts all the time somewhat recently...
But yeah, all the 'medium sized' PNW cities are absurdly overpriced now.
I ended up getting assaulted and seriously injurrd.. and am living off of SSDI while recovering... many states away, where a person can actually rent a place off of disability alone.
Spokane (or, as I call it, Spokanistan). I once lived in Seattle and liked to visit B-ham with its hippies and WWU and proximity to civilization (B.C.). But it was always WAY too expensive, even back in the 90s. I considered Tacoma and that probably would have been the smart move - Old Town is pretty cool and I don't think I've noticed the Aroma of Tacoma since the 90s. I lived in Tumwater for a year and Oly still has a certain charm - pretty leftie and so very close to the Olympics and all that wilderness and of course the ocean.
All those S. Sound cities have gotten crazy expensive but not as bad as Seattle and north as far as I can tell. I can kind of understand it - people getting pushed out of Seattle by gentrification but who can still find a job and afford an apartment or maybe even a house a bit further south.
I hadn't heard that north of Seattle had gone to hell and I've got to wonder how the dumbass tariff stuff is going to hurt Boeing manufacturing in Everett and hurt their local suppliers (if any) too. I doubt it will be enough to cause an outright crash there - the demand always seemed to be, uh, "organic" rather than speculation, but it's been a long time and I'm out of touch with that region.
Spokane is a cultural void for the most part, but politically it's surprisingly purple and getting more so. The job scene, except perhaps for medical, simply blows. What's inflated RE prices here seems to be people coming in from out of state who don't need a job or who work remotely, and who have some kind of fantasies about "getting away from it all". And of course the speculators and second-home buyers and developers. The skies here are full of corpo jets coming and going from Sandpoint (resorts) and CdA (resorts) and western MT (resorts) from Seattle and CA and the Southwest .. wouldn't break my heart to hear that their occupants' RE portfolios have tanked one day.
Sorry to hear about your assault. I'd be super freaked out to have to depend on Social Security
<anything>
with this regime in power.But a house in this economy? Pffftt lol