The Spring sales season ends with a thud. Affordability is in the gutter.
Existing-home sales have gone nowhere since October 2022.
The National Association of Realtors reports Existing-Home Sales Rise 3.2 Percent in May.
“The back-and-forth in monthly home sales activity, driven by mild fluctuations in mortgage rates, shows how sensitive home buyers are to affordability conditions,” said NAR Chief Economist Lawrence Yun. “However, job gains—more than half a million since the beginning of the year—will continue to provide support for the housing market.”
“The median home price has reached an all-time high. Even so, affordability is better than a year ago because wage growth is outpacing home price growth,” Yun continued. “However, progress on long-term housing affordability could be hampered if inventory growth continues to stall. Without consistent gains in inventory, home prices can accelerate. It is critical to introduce more supply to the market to widen the opportunity for homeownership.”
Existing-Home Sales Month-Over-Month
Changes have been essentially trendless for years.
Key March 2026 Statistics
- Sales Month-Over-Month: 2.4% decrease in existing-home sales month-over-month.
- Sales Year-Over-Year: 2.8% increase in existing-home sales year-over-year to a seasonally adjusted annual rate of 4.09 million.
- Inventory Units: 1.56 million units: Total housing inventory down 0.6% from May and up 1.3% from June 2025.
- Inventory Supply: 4.6-month supply of unsold inventory, up from 4.5 months last month and unchanged from 4.6 months one year ago.
- Median existing-home price:$440,600: Median existing-home price for all housing type.
- 1.8% increase from one year ago ($432,700)—the 36th consecutive month of year-over-year price increases.
- Median Market Time: 28 days median time on market for properties, down from 29 days last month, up from 27 days in June 2025.
Existing-Home Sales Year-Over-Year
Existing Home Sales Supply
The NAR does not seasonally adjust much of its data as evidenced by the above silly looking chart. chart.
Seasonally adjusted, supply is no longer rising. May and June supply are below the highs a year ago. That’s the first time since at least 2021.
Existing-Home Sales vs Mortgage Rates
In contrast to Yun’s statements, there has been no traction in existing home sale with declining mortgage rates.
Rates fell from 7.62 percent to 6.05 percent with sales meandering nowhere.
Sales have basically gone nowhere even as rates fell from 7.62 percent to 6.05 percent.
But rates have risen again. The current Mortgage News Daily rate is 6.68 percent.
MND is more accurate than the Freddie Mac data in my chart because it includes points and fees. I use Freddie Mac data because I have a download from the St. Louis Fed.
The only conclusion is home prices are still too high, mortgage rates are too high, or both.
Affordability Nonsense
Here is Lawrence Yun’s comment on affordability from last month.
“More Americans are on the move, with home sales rising to the highest level since December. This is great news for the housing market and the economy,” said NAR Chief Economist Dr. Lawrence Yun. “Improving affordability is helping drive this momentum. Even with mortgage rates ticking up compared to earlier in the year, they remain lower than a year ago and are essentially at the long-term historical average. Income gains are also outpacing home price growth by a small margin in most parts of the country.”
“The new record-high May home price reflects solid fundamentals for homeowners and ongoing supply constraints,” Yun said.
I commented, “So we have record high prices and rising interest rates and Yun yaps about improving affordability.”
Yun repeated the nonsense this month on the basis of wage growth.
Real wages are declining, median prices are rising, Case-Shiller home prices are at record highs, and mortgage rates are back up to 6.68 percent.
Yet, Yun claims affordability is improving.
Yun calculates an affordability of 102.3, up from 95.5 a year ago. That’s a 7.12 percent increase in affordability. What a preposterous hoot.
Synopsis
- Real Income falling
- Home prices rising
- Mortgage rates rising
- Case-Shiller record high prices.
- Yun claims affordability is improving
Related Posts
May 26, 2026: Consumer Credit Stress Is Comparable to the Great Recession
Auto delinquencies are at a new record and credit cards are near record high.
June 16, 2026: Housing Starts Crash 15.4 Percent on Top of Steep Negative Revision
Compared to the unrevised April number, starts decline 19.7 percent.
June 25, 2026: New Home Sales Drop Another 7.3 Percent, Builders Struggle with Rising Inventory
Sales are down. Inventory is high and rising, pressuring builders.
July 5, 2026: Case-Shiller National Home Price Index Hovers Near All-Time Highs
Home prices remain in the stratosphere, transactions in the gutter.
And Yun hoots about affordability.
Low Birth Rate Risks Creating US Housing Glut Over Coming Decadehttps://www.bloomberg.com/news/articles/2026-07-08/low-birth-rate-risks-creating-us-housing-glut-over-coming-decade?accessToken=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJzb3VyY2UiOiJTdWJzY3JpYmVyR2lmdGVkQXJ0aWNsZSIsImlhdCI6MTc4MzUxNzYzMSwiZXhwIjoxNzg0MTIyNDMxLCJhcnRpY2xlSWQiOiJUSFVSV01SMjRVOEswMCIsImJjb25uZWN0SWQiOiI5NDU1RERFRjRCOUU0MDM3QTI5NkMyNEQyNjRENTFFMCJ9.D1gBEvVMuCnGZNCCjPeDY0vDWFYfOexFcAT7hGxPPD0
The Silver Tsunami is real, it just won’t cause a sudden collapse (although other things might). Supposedly 70% of heirs sell, and I think that’s accurate. Without another wide open borders president, the people-to-structures math in the USA looks bearish for prices over the next 10 years (at least) to me.
Lots of talk about building affordable housing. Few are doing it.
Land, permitting and infrastructure costs drive the cost bus and when those investments are met it is more profitable to simply build a nicer house and capture a decent profit instead.
In LA, “smart”, “nimble” and “hesitant from last time” builders radically overestimated how many affluent Millenials and Gen Z there were willing to drop $3,500/mo on a shoebox flat. They overbuilt “luxury” and rents have definitely been sliding in some segments.
I was listening to Gerli on Adam Taggart’s podcast and he says that inventories are GROWING because owners are refusing to drop prices faster due to a lack of demand for over-priced Housing.
Link: https://youtu.be/nQjdkKaOe7o?si=ZNm7BgGZDLO9PkMw
That is link to Gerli’s appearance.
They’ll leave.
“Send an ambulance or a hurst”
Gerli’s been right, it’s just all been happening at less than half the speed that the “history and math still matter” bears predicted. I for one did not expect the covid distortions to still be around 6 years later but they very much still are. The reason we haven’t seen a much bigger and nationwide correction yet is because the government keeps postponing all the natural foreclosures and then loosening lending standards on top of that. The fact that the government now backstops 1.1 million mortgages at 50% DTI is insane, but that’s how the prices stay so high in much of the nation. This will make for an inevitable disaster eventually imo.
High real rates of interest would take care of the housing market. Asset valuation prices are driven from the appraisal of loan collateral which depends upon Gresham’s law: “a statement of the least cost “principle of substitution” as applied to money: that a commodity (or service) will be devoted to those uses which are the most profitable (most widely viewed as promising), that a statement of the principle of substitution: “the bad money drives out good”.
The investor tax breaks overwhelm the interest rates. While higher interest rates would help at the margins, I’m not sure that higher interest rates would have as much impact in lowering prices as most people believe. FHA conventional mortgage rates would have to be in the 8%+ range to make the dent that most people expect, and that’s not going to happen any time soon.
For high real rates of interest, you have to have low inflation rates. The Golden Age in Capitalism is the model.
During the U.S. Golden Era in Capitalism (not optimized), the annual compounded rate of increase in our means-of-payment money supply was about 2 percent. During the decade ending in 1964 aggregate monetary purchasing power, AD, money times the velocity of circulation, increased at an annual compounded rate of about 6 percent. In the subsequent 9 years, the increase was more than 13 percent, and in 1972-73 nearly 30 percent.
Ph.D. economist John O’Donnell posited that velocity financed 2/3 of the economy during the US Golden Era in Capitalism, whereas today, money finances nearly all of the economy
I.e., lending by the banks is inflationary. Lending by the nonbanks is noninflationary, other things equal
In almost every instance in which Keynes wrote the term “bank” in his General Theory, it is necessary to substitute the term non-bank in order to make Keynes’ statement correct.
This is the source of the pervasive error that characterizes the Keynesian economics, the Gurley-Shaw thesis, the elimination of Reg Q ceilings, the DIDMCA of March 31st, 1980, the Garn-St. Germain Depository Institutions Act of 1982, the Financial Services Regulatory Relief Act of 2006, the Emergency Economic Stabilization Act of 2008, sec. 128. “acceleration of the effective date for payment of interest on reserves”, etc.
None of the Chairman nor its technical staff knows how the system works.
Even under William McChesney Martin Jr., he thought that “banks actually pick up savings and pass them out the window, that they are intermediaries in the true sense of the word”
Dr. John Cochrane: “Nobody really knows how monetary policy works, and certainly not with the complex technocratic expertise that the Fed pretends.”
And don’t ask AI, you’ll get 4 different answers for the same question.
Lawrence Yun….”There’s never been a better time to buy”
His schtick never changes.
If Yun were in Hiroshima in 1945, he’d say that this represented a huge buying opportunity, better lock in those low prices, you gotta buy now!
To be fair, he’d axtually be sort of correct, at least directionally.
Of course, in Yun were in Hiroshima in 1989, he’d say that the rise in real estate prices proves that you gotta buy now while you still can.
The FED Crashed The Housing Market When They Drastically Raised Rates – After Lowering Them To Almost ZERO For Around TEN Years To Save The Too BIG To Fail/Jail Corporations & Banksters – Which Caused MASSIVE Inflation.!
– The FED Crashed The Housing Market When They Drastically Raised Rates, After Lowering Them To Almost ZERO For Around TEN Years To Save The Too BIG To Fail/Jail Corporations & Banksters – Which Caused MASSIVE Inflation.
> According to Freddie Mac Rate Data, from 1972 to Present Day, the 30Y Fixed Rate Mortgage has never been below 3%. The lowest in this time span of time, was 3.15% in 2021.However as quickly as 2022, it jumped up to 5.53%. It also only fell below 4%, 5 Times in that same time span. JS…
In 2010, the Federal Reserve kept the federal funds rate target near zero, ranging from 0.00% to 0.25% – After Sliced & Diced Mortgage Scam Run By The Goldman Sachs Bankster’s Collapsed The Markets!!
In 2010, the federal funds target rate was kept at a historic low range of 0.00% to 0.25%.
The Federal Reserve set this near-zero rate to help the economy recover from the 2008 financial crisis.!
Bailed Out The Too BIG To Fail/Jail Corporations & Banksters.!
Lock Her Up (2016) – NO ONE At The Top Gone To Jail/Prison Yet.!
Yun needs to speak to the housing foreclosure rate (%) is back to 2000 level highs. Even worse than GFC!
Going down.
And that may take GDPNow into negative territory shortly.
But I thought Trump was going to deport all those job-stealing house buying immigrants and renters and blacks would rejoice with amazing housing deals all over the country. What went wrong?
Do we need 3 more Trump terms to make that happen?
Do worry, Trump, Walrus & GOP will find a way to make things even worse.™
“What went wrong?”
Slowly but surely, the Supreme Court is fixing the problem. And in many markets, both rents and home prices *are* coming down. In most other markets, YoY growth rates in prices are slowing. The immigration problem was real in driving up prices.
But few are buying….as the post points out. And if Trump gets his rate cuts, housing prices will likely rise up again. Of course, if Trump’s Iran war keeps going, oil will go through the roof and inflation will soar and no one will be able to afford anything.
So what went wrong?
The Fed bought $2.6 Trillion of MBS during Covid through purchases and reinvestments, driving mortgage rates under 3%. That ridiculous forced distortion of the housing market is why few are buying today. Most sellers are also buyers, and most of the sellers have disappeared in response to the Fed’s MBS debacle.
Stupid took the wheel.
Turns out those were the people that built houses. Another Trumpstien triumph!
I suppose we can always move into Hoovervilles as inflation continues to crush 95% of the population
Go long on cardboard and corrugated tin.
Nothing like watching funny Yunny the clown giggle and clap while America walks into the kind of crisis that’ll make 2008 look like a good time. No jobs, no houses, real wages in the gutter, inflation fully out of control, and the entire United States economy is perched on a bubble investors see popping in the next two years. What more can Americans ask for?
The best part is that none of the levers available to anyone will work anymore. Does the Fed slash rates and set the inflation on fire? Maybe they hike them and watch as jobs dry up even further. There’s no way to get people out of the houses they bought at bargain rates, and people can’t afford to pay on a house like a bad credit card, so that’s going to need huge intervention to fix. And even if you do have a sweetheart deal on a house, your groceries and gas now eat up most of your budget. Good luck replacing a broken refrigerator.
My question to you Mish is what can even be done at this point. I’ve said before and I will say again that I don’t see a recovery for this outside of FDR tier government intervention to break up out of control monopolies (see the entire tech sector), save agriculture from becoming an out of control oligopoly, and reel in K shaped regulation that’s rendered us a corporate socialist dystopia. And that’s something neither party has the chutzpah to do currently.
Dont forget power. Electricity is gonna go through the roof between data centers and when the new gas terminal opens up and we can export more to the eu.
I mean on one hand electricity is going to be pushed renewable and that’s a good thing. People’s houses should come with solar, not after the fact. On the other hand, data centers are not a sustainable thing. The “demand” for AI is a mixture of circular financing and free lunch handouts to court potential customers. The entire ‘industry’ is bleeding money with no path to making it because none exists. You cannot monopolize an entire technology, especially when it can run on your phone locally for most uses. It is tulips all the way down because people know the stock market is up the creek with a turd for a paddle otherwise.
“My question to you Mish is what can even be done at this point.”
Well I’m not Mish but my take is what I’ve been saying all along: Got exit strategy?
At least you’ve proven yourself to have a functioning brain. You see the issues, you know there’s no real answer except one. Welcome to the great awakening.
MPO we constantly hear about this “exit strategy”, but I don’t think I’ve once heard you explain how exactly you plan to “exit” something like this. Do they use clams as currency where you’re going? Do you not see more expats following you for work if this gets bad? I fail to see the rationality if you’re planning for something this bad.
There are no guarantees with any strategy or plan, the point is to have something other than sit and whine all day about it.
You seem to be managing both quite handily.
The true exit strategy is to learn skills (hunting, gathering, repairing and maintaining machinery and engines, and know how to build things for example) and live with what you can carry.
Anything besides this and you wont see freedom imo. Why because anything less than what I stated above breeds dependency, and that can bring one to slavery, or death in a SHTF moment.
A bonus is to plan this with like minded individuals, but even this can backfire and you’ll end up in dependency.
If you can’t learn skills stack things to barter (metals, drugs, alcohol, bullets, food, medical supplies are the biggest imo).
The problem with stacking is (1) your resources are tied to a location, and (2) eventually others will know what you have and you’ll have to protect it.
In a true SHTF moment there is no guarantees of any plan working and as such this is why prepping, honing skills, and even stacking are important because each will give an opportunity to turn the tide to your favor.
I used to really like watching those DoomsDay Prepper ‘reality’ shows on TV about 10-15 years ago.
People spending an immense amount of time, effort and money to be ready for the Big One – while I watched TV and passively invested my money into basic stock market indices.
I wonder how those preppers are doing today?
“People spending an immense amount of time, effort and money to be ready for the Big One…”
This is a problem I agree because its never a big event. It’s always a slide down, and often people are in the middle of the chaos when they realized their cooked. Knowing when to break from the fall is the key to survival.
“…while I watched TV and passively invested my money into basic stock market indices…”
So you invested in paper? I hope that works out for you.
For one thing, their potassium iodide tablets have expired.
These plans have always been dumb as hell though. None of that stacks up to “guy who is liked by his community” in terms of usefulness. It’s the same logic that’s turned our military from something everyone contributed to into a special forces obsessed short bus.
Be liked by your neighbors, be kind, be intelligent. That’s really it.
“Be liked by your neighbors, be kind, be intelligent. That’s really it.”
In a true SHTF moment you can be in a situation where you thought you were with like minded people and thus with friends but you’ll be surprised how quickly people will turn on each other.
Add to this resources running thin, and your with people who have families and it can get ugly fast.
Thing is humans who never faced starvation, fear of being hunted (and you will be hunted in a SHTF moment once you excise any freedoms), the immense stress of the unknown, and having to contend with the elements they’re unpredictable.
IMO that leaves 99% of the population as unpredictable, and if you’re willing to add that to a SHTF safety net by all means I wish you the best of luck.
This just sounds like you don’t have good friends or a decent community. In fact, you sound like you’re describing a full on delusional fantasy at this point. I recommend you go buff up on the Civil War and the aftermath thereof.
“This just sounds like you don’t have good friends or a decent community.”
You must be hearing me incorrectly. That or you never really contemplated reality, for even in the best of times humans turn on one another.
“… you sound like you’re describing a full on delusional fantasy at this point…”
I’m sure when this individual:
https://en.wikipedia.org/wiki/Reinhold_Messner
told other what he was planning to do they thought he was delusional too.
I’m sorry you have to slam other people to feel good about yourself, but I honestly hope your strategy works out for you.
This isn’t climbing a mountain though? You’re not beating the delusional allegations. I study history, you’re busy reading the Turner diaries with one hand. We’re not the same.
Creamer,
(1) Everything I listed as a skill in my original post people do every day as a means to make money, to extend their money or to find joy in their life. If you can’t do any of these that’s ok, but you don’t need to insult people because like I said you can always stack.
(2) If you were as astute as you claim about history you’d realize as recently as the great recession the only way people ate was by hunting and gathering. In fact many down south lived off beavers during that period (as well as dear, turkey, fish to name a few).
(3) Climbing Mount Everest solo will be the closest anyone right can get in regards to living in the raw brutal elements, learning to think and solve problems that if you don’t solve you’re dead, and learning to master one’s fear. Much like living through a SHTF moment. And if you don’t think so I’m not sure I’m the one with delusions as you claim.
Like I said before Creamer you must be reading me incorrectly, or you never contemplated (maybe the better word is experienced) life.
You never name the place where things will be sunshine and kitten farts when the global economy collapses and WWIII breaks out. Afraid it will get crowded?
I think it’s Haiti.
You haven’t been paying attention, Trump is gonna turn Cuba into the new mini-Israel….
At one point, every place in America was the “best place to live.” Heck Detroit was THE place to live at some point.
https://en.wikipedia.org/wiki/History_of_Detroit
And the reason I never name a place is because the answer is mobility. Portugal was the place to go a decade ago and now it’s in trouble because it got flooded by “expats” (note they are not called “immigrants” -lol). The locals are angry and citizenship laws changed already, it used to be 5 years now it’s 10. Other countries are following suit, Italy just pulled the plug on claiming citizenship for Italian descendants in other countries (i.e Americans). Everyone around the world knows the gig is up so if you haven’t been researching and preparing, you’re screwed.
The answer is simple, you need at least 1 residence on at least 3 different continents. Which 3+ is up to you and your likes. For me, I have residence in Europe, North America and plan on adding Asia and Latin America.
Where specifically? well that’s trade secret and I don’t want my picks ruined by migrating boomers too broke to live in America. These fools can rot in the pig pen they created.
And good news for the MPO haters, I won’t be posting after next week. Wrapping up final stages of my exit strategy!
I’ll stop by to say my final “hasta la vista baby!”
“And the reason I never name a place is because the answer is mobility.”
BINGO!
And I’m sure you have enough money and those nations wouldn’t just kick you out in an emergency. That makes perfect sense. Houseboat perhaps? Or, maybe, you don’t have any of that and can’t even make a pass at pretending you do so you’ll gas on about your awesome 4 houses in every continent that you can fly your jet to. We all believe you!
What you believe or don’t believe is irrelevant. I’m out but you stay and enjoy the sh!tshow and watch your quality of life deteriorate to nothing. Then, at the moment of your deepest despair, you’ll think of me (MPO) and wonder why you didn’t listen.