Marketplace Morning Report Housing is in a slump
May 23, 2025
Existing home sales have plummeted to around 4 million annually, a stark contrast to nearly 7 million during the pandemic boom. High home prices and mortgage rates are major culprits, exacerbating affordability issues for buyers and renters alike. The discussion also highlights predatory practices targeting wildfire victims in California, advocating for new laws to protect homeowners. Lastly, innovative investment strategies aimed at improving local housing solutions seek to elevate displaced residents and return stability to the market.
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Housing Market Faces Slump
- Existing home sales dropped to about 4 million annually in April, down from nearly 7 million from 2020 to 2022.
- High home prices and mortgage rates near 7% create severe affordability challenges, limiting market activity.
Builder Hesitation and Price Pressure
- Homebuilders hesitate to start new projects due to high borrowing and material costs.
- Increased inventory puts downward pressure on prices, with Zillow forecasting nearly 1% home price declines next year.
Wildfire Victims Face Predatory Offers
- Residents like Sandra in Altadena received low-ball offers for their wildfire-destroyed homes, which they ignored.
- California’s initial moratorium on unsolicited offers ended, prompting lawmakers to propose new legislation.