This Housing Crash Is Already WORSE Than 2008

The data that continues to come out gets worse and worse every week and it is way worse than you think. I know there's a lot of economists out there and housing experts who say things are going to be better. 2026 is going to get better. The reality is there's no chance that that's going to be happening, especially in Florida and across the United States.

It's getting worse across the United States and it's spreading rapidly. The housing market is in trouble and we're going to be going over some of the data as why that is and what you can do to prepare now if you own a home or you're thinking about selling a home. So, the number one thing you want to realize is that this is the second lowest number of sales ever. This is a huge issue because we've had 20% population growth over the last few decades, but yet we're at the second lowest level of existing home sales that came out in July 2025.

388,000 existing home sales, the lowest sales since 1999. So, this is really bad. I know that people are saying, "Well, it's not as bad as the great financial crisis." And you're right, it's worse. We're already feeling this type of distress.

And when the number of existing home sales start to slow down, that is the number one indicator that everything else is about to slow down as well, including price. So price drops are just waiting because the reality is you just have inventory stack and stack and stack up. As these home sales go down, sellers get frustrated, sellers start capitulating on their price. They start reducing their price and everything starts moving forward that way.

So here's, you know, the nonseasonally adjusted home sales. I think it's a good representation of what happens. Of course, you could see where we are today and how how low we are now. It's not going to get fixed by Fed Powell reducing interest rates by 25 basis points.

That is not going to change overall how the consumer feels about housing or what is coming next for housing because we are ultimately in what's called an affordability crisis. It is really bad. When you look at the median household income versus what the median sales prices are, it just doesn't make sense for the average consumer to buy. In a lot of cases, it's cheaper to rent by about $500 a month.

You don't have to worry about the repairs. And look at this. You can see this chart is fantastic from Visual Capitalist. You can see Florida gets a ranking of 0.52.

That's one of the least affordable rankings out there. Um, you can also see that it's less affordable to live in Florida than it is in California, which is kind of mind-boggling, but this is from a median household income perspective. You can see that it's starting to go across the United States. Even we're starting to see affordability issues pop up in the Northeast where we've seen some resilience.

Now we're starting to see it get weaker and weaker and it's just a common sense thing now that we can see look there's going to be epicenters like Florida and Texas, Arizona, now Nevada, California, Colorado. These are areas that are super unaffordable and are getting more challenging to do real estate business in. But it's going to spread across the United States over a period of time. So again, I think that we don't need interest rates to come down.

We need prices to come down. That's the way we reset the system and let the next generation of home buyers actually be able to tap into buying real estate. That's how you get a healthy market. It is not by reducing the Fed funds rate, which actually, by the way, could actually raise interest rates because it could stoke inflation fears because the Fed only controls the short term overnight borrowing rates of banks.

Okay? Unless the Fed's going to go and do quantitative easing and start buying mortgage back securities, which they've done in the past, trillions of dollars worth, it's possible that, you know, we we could see that happen. It's very unlikely to happen unless we're in an absolute crisis mode, but next year probably not going to happen, but reducing rates is not going to be enough to save the housing market moving forward. Now, the income you need to buy a house, look at this, it's about $120,000.

Plus, the median household income in Jacksonville is 68,000. So, you have to have a dual income working family if you live here to be able to purchase or you already have to be wealthy and have assets and have this level of income in order to be able to purchase here locally. And Jacksonville, Florida used to be specifically a very affordable place. That's actually why I moved here.

And then, as you can see, over time, it's just become like ridiculously unaffordable. So, the income required to keep home payments affordable is just with a 20% down payment. And by the way, we have a lending company. We do not see people have 20% down payments.

The people who could afford to buy, who had the good credit scores, who had the income, they've already purchased about 80% of them. So now you have this massive wave of sellers coming on over, you know, fighting over this 20% that didn't buy yet. And those are very educated people. They're going to be negotiating with you.

So again, we think that prices will come down and um income to buy a house is out of control. We need to see wages go up and we need to see prices come down to get into more of an equilibrium. This is a crazy chart. New houses are now cheaper than existing homes.

This is a massive red flag. This actually uh only happened one other time. You can see here in 2005, you know, right before the crash, this type of experience happened also. So, not only are the new homes less expensive now, but they're also offering on average 4050 $60,000 worth of incentives and rate buyowns.

And so, we think the existing home inventory will start falling. We know that new home sales inventory prices are falling. And the incentives that the builders are giving are just absolutely incredible. But this this, you know, inflection point here is a huge red flag for the housing market.

And we think that this could continue. We think that the prices are simply just going to have to come down both across the board between existing homes and new homes. Regardless of where you are, but especially in areas that are that are overbuilt and they've overbuilt across the United States, the home builders, the national home builders across the United States, they got addicted to the easy money, the fast sales, and they again, they did it again. They overbuilt.

Uh it's just human nature that that this happens. So, here's LAR, which is a very difficult uh company to work with if you're a real estate agent. First they tried to cut out the real estate agent. Now they're begging real estate agents to come back and bring buyers to their brand, even offering incentives on top of the 3% commission the agents get.

They actually sometimes offer five, six, seven. I've seen even 10 times uh 10% commissions depending on how many you sell in the community. But the this is LAR's average selling price net of incentives. It's dropped, look at this, 2022 from 483,000 all the way down to 389,000.

We're talking almost $100,000 just within 3 years. That is significant amount of drop and it frankly could drop another h 100,000 here. Locally, we see some of the builders are dropping their inventory price by $100,000 and offering the incentives. So, if you're a buyer out there looking to buy, the only problem that you have is if you get that rate buy down to 3 to 4%, you would have to stay in that house for basically 30 years because that incentive is built into your rate.

And you would have to stay there an extremely long period of time to be able to see that actual benefit come to fruition. Because if you go to sell in year 10, chances are that you won't have made up the difference. It's sometimes better actually to take a lower price than it is to get the incentives on the rates depending on the time frame that you're going to be living in the house. But ultimately, the builders are screaming from the rooftops, "We need help." They're going to the administration saying, "We need help.

We need to keep pushing, you know, pushing our inventory," which is super ironic because they told us the entire time, the media that there's this housing shortage. How can there be a housing shortage when all the builders are screaming fire already and it's only been a few years? There is no housing shortage. What there is is there's an affordability shortage.

There's a there's not affordable houses. They're not built. Look at the price points they're building these in, right? $500,000 house.

That's not what consumers can afford right now when they make only 60 $70,000 a year, right? And even that's pretty good for a household income. They can they can afford usually in the $200 to $300,000 price point. So, I really think again we have an affordability crisis.

We don't have uh an under supply crisis here. We obviously it's the opposite when you see inventory just start to stack up. This is the highest inventory that we've had of new single family homes for sale since October 2007. So I know people say it can't happen again.

It can't happen again. Of course it can happen again. Actually it's happening again right now in the FHA world which is the government just continues to create programs to extend and delay losses in the housing market propping up the entire market. I mean, FHA, you can do loan loss mitigation um workouts and basically add your payments to the back end of the mortgage and it's a huge problem.

It's keeping properties that should have been coming on the market in distress from coming onto the market, pushing prices absolutely continued up. And they've been doing this all the way back since 2020. And they came up with these programs to keep people in their houses. And we have not had a normal unmanipulated housing market for a very long time.

And if you did, if the government wasn't buying these mortgage back securities or having these workout programs to keep people in their houses, we would be seeing a completely different market here today that would be pretty much double as worse of what we're seeing right now already when we're not even seeing distress and we're seeing assets near all-time highs when we think about the stock market, Bitcoin, and other asset classes. So, look, our expectation is that real estate is seasonal and we think that the going into the end of the year and going into early next year, we're going to see inventory continue to stack. We're going to see prices come down across the board. We think it's going to hit the majority of the markets across the United States, and it's going to get worse from here on out going into next year.

And next year, we're going to see this wave of foreclosures because October 1st, these FHA and VA workouts are no longer going to be allowed. It's going to be much more difficult and we're going to finally see the foreclosures backlog start to hit the markets moving forward. So, here's the reality. Prices are already starting to drop.

So, again, I still don't understand why we see a lot of housing experts and economists come out and say, "Oh, everything's fine. It's getting worse every single month." Home prices fell on a record 39 major US metros in July. And you can see that that was, you know, that's the worst it's been in basically a decade. And we expect this to continue to move up and move uh move prices down, you know, as as headlines start to come out.

What's really concerning is the pending home sales. Home sales are just grinding around along the bottom there, and we expect them to actually go a little bit lower. It's felt really awkward if you're a real estate agent or if you're looking to even sell your house, if your house is not in mint condition. And I will say this, there are pockets of areas that are very unique, like Jacksonville Beach, let's say, for example, or Neptune Beach, where there's a limited supply of inventory, the housing is beautiful, it has ocean views, and there's really not a lot of inventory to compete with.

Those type of areas are going to keep up a little bit better, but they will eventually get hit. But the problem is across the board, the pending home sales coming down this much, the inventory is going to stack and we expect it to be a challenge moving forward through the end of the year. Of course, if you're a real estate agent, you feel this. You're starting to see it every single day.

Maybe you've had your head in the sand for the past few years and just ignored what's been happening since 2022. But if you haven't change your business soon, your business model and what you're spending and how you're doing business, then you could be in real trouble starting now. Basically, I we're starting to see a lot of distress amongst real estate agents and able to sell the properties that they're listing. Now, this is where new home prices are dropping the fastest.

Okay. So, obviously, we're seeing Little Rock, Austin, Witchah, Jacksonville, Jacksonville is where I'm at. We definitely see prices coming down 7.81%. It's it's about double that in reality from this chart.

Um, this comes from realtor.com. Cape Coral, another Florida location. Colorado Springs for sure. California, Virginia, um Tulsa, Nashville.

So, we are starting to see these new home prices come down pretty significantly across the board and the unaffordable areas are getting hit the hardest. The areas where they built the most, where there was the most speculation, and frankly, there's a lot of tourism, right? The Airbnb markets and the speculators moved in to try to make as much money as possible, and they're getting crushed. I'm really excited.

I have a guest coming on about the Airbnb market to tell you everything, the insides out of what is going on inside of the Airbnb across Florida and across the United States, what they're seeing on the ground with data. Be on the lookout for that. But it is a bloodbath to say the least in terms of what they're paying for maintenance and, you know, to run their Airbnbs versus, you know, the insurance and everything like that versus what they're getting. Especially when you see the occupancy drop so significantly, it really impacts your market.

And so I think Jacksonville is in for a crash. I know so a lot of people disagree on this. You can think what you want, but the data is all pointing towards a crash. I don't see a way around it.

A crash is a technical 30% drop from the peak. Okay? So we peaked in October of 2022 here in Jacksonville, and we're already down about 15%. So we're in a technical correction.

And I know nobody wants to talk about it because it's not good for business, some people say, but you have to be real on what's going on. You need to be able to communicate it to to your sellers. And be real because you need to adjust your business plan. You need to participate in the market.

You can't just pretend things are not going well and uh you know, expect that reality is not going to catch up with you. You need to get real on what the prices are doing and then adjust as much as possible. And sellers need to be realistic about the price of their home. I mean, if your house is outdated and there's 10 other houses in your community for sale, I mean, you need to get real.

You have to drop that price really significantly to get a buyer. And the good news is because it's an affordability crisis, if you drop it to the price where you know buyers will be interested, you will get three or four offers right there on the spot. We see that happen all the time. Once the price hits where the market will accept it, you will get multiple bids.

Again, because it's an affordability crisis, it's not that the demand is not there. The demand is there. It's just so expensive for people that they're doubling and tripling up living in apartments together, living in sun rooms, you know, moving back in with their parents, things like this, just because the prices are so crazy. So, I think it's a really good thing that prices are moving down.

The one thing that is not being talked about enough is this natural population growth is horrendous. This natural increase in births minus deaths. You can see this in the United States versus the immigration. And I mean the immigration was insane.

I mean open borders was just out of control, right? But we're not having enough people in the United States have kids and have household formation. And this is really bad for housing. And what we're seeing is people are are starting to it's because it's like too expensive to buy house.

It's too expensive to get, you know, student loans, things like this. It is not the same as it used to be when you look at the ratios. And frankly, what's going to make it worse is that 5,000, it's estimated between 5 to 6,000 boomers per day were start passing away between now and 2035. And they all they have the majority of the wealth in real estate.

So, let's look into this. You can see that the boomers are this uh this segment right here, and they own the majority of of real estate. And then you have Gen X and Millennial and the silent generation. So this trillions of dollars will be passed down or evaporated into basically retirement communities or assisted living facilities.

And these these folks are passing away. Their inventory they own in some case these boomers own four houses 3 2 1 and they're starting to sell their rental properties and things like that. Them passing away means that you know 70% of these houses when somebody dies are are sold. They're not kept within the family.

And this demographic shift is going to be insane. So we have a lack of births and then we have more deaths of just this generation that are going to push housing downward long term. So I don't think we're going to have we have this housing shortage that you know all this news and media are talking about. I think it's actually the opposite and I think it's going to get really painful to own real estate long term.

Um if this continues to be the trend now of course there will always be intervention by the government if things go too haywire. So this is to hedge that by saying if the without government intervention I think that we can see a real downturn here that's worse than the great financial crisis and the leading indicators are negative. This is from Charles Schwab Bloomberg uh just you know a week or two ago but there's basically people are not feeling positive about the economy. Things are really expensive and people are starting to experience job loss.

And so we are at basically a low level that we were in 2009 and it doesn't even feel like we've been hit yet at all with any struggle and stress just because the stock market's kept up and actually risen so much. So we think, you know, this is an outlook that's really negative. We think that AI companies are going to continue to crush it as they replace employees. But the real economy is going to get, you know, absolutely decimated here because if you're talking to the average person, they are not doing so well financially and that's going to impact the housing market and their ability to purchase.

Now, Florida is definitely the canary in the coal mine. We are probably the worst set up for this, especially for the deaths. We have about 22% of our population is our boomers are older which is a large it's a significant amount of the population but you can see here's the 10 slowest housing markets in the United States from realtor.com you know Miami or Orlando's getting absolutely crushed because they really overbuilt that area Jacksonville Florida Tampa Florida and then other hot spots like Raleigh that was a tech hub we saw a lot of growth there and now it's actually moving backwards. Um Nashville Tennessee is number one which is wild.

So, we're probably going to see a little bit more of a slowdown. So, this is actually going back to a normal number that, you know, when I was selling real estate from 2016 to 2019, it wasn't unusual to have a house on the market for 60, 90, 120 days. So, we're just going back into a normal environment. It's just happening very quickly.

Usually, real estate does not correct this quickly. It's a very slow step every single month. Uh, this is moving really, really rapidly and basically like doubling very quickly. Now, this is the home values that dropped.

So, markets with the biggest drop in home values over the last year. 13 in Florida, two in Texas, and one Arizona. So, you can see that home prices are coming down, which again is a good thing for if you're a home buyer, but we need to see prices come down quite significantly more based on what we're seeing to get buyers back to the table and start having transactions. We'd love to see what you see in your neighborhood.

Are you seeing more for sale signs? What's happening in your market specifically? As always, please subscribe and like and comment. Definitely helps out the channel.

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