The US Housing Market: 10 Facts vs. Fiction to Know

If you’ve been tuning into the buzz about the U.S. housing market, you’ve probably heard everything from doom-and-gloom predictions to outrageous claims about a so-called "housing bubble burst" that’s just around the corner. But a lot of that noise is based on outdated information or straight-up real estate myths. 

So, let’s cut through the chatter and talk about the real housing market facts. And, as a bonus, we’ll sprinkle in some real estate trends and actionable insights for anyone interested in investing in real estate or buying a home in 2024. Ready? 

1. Low Housing Inventory Is Still a Major Factor

Think of the current low housing inventory situation like a game of musical chairs - but with 10 players and only 6 chairs. That's exactly what's happening in our real estate market right now. We're looking at just 1.8 million homes available, way below the needed 2.25 million.

And you know what happens when demand crushes supply? Prices stay strong or even climb higher.

Here's one of my favorites real estate facts that might surprise you: for a market crash to happen, you need more houses than people. But right now? It's the exact opposite. We've got more people than houses, and that alone should make you question those crash predictions.

2. Home Price Trends Show Long-Term Growth

Let’s take a walk down memory lane. Back in 1950, the median home price in the U.S. was about $7,000. Fast forward to today, and it’s well over $400,000. That’s the beauty of real estate investing – homes appreciate over time.

Sure, there are bumps along the way, but historically, the trend is upward. Even with the small dips we’ve seen recently, the overall trajectory points to growth. So, instead of panicking about a potential market crash in 2025, think long-term.

3. Mortgage Delinquencies Are at Historic Lows

One of the best indicators of a potential crash is how many people are behind on their mortgage payments. And right now? Those numbers are rock-bottom.

Serious mortgage delinquencies (those 90 days late or more) are at historic lows.

It's like watching a ship sailing smoothly on calm waters - homeowners are keeping up with their payments just fine.

This is a key reason why we’re not facing a repeat of 2008. The real estate market data just doesn’t support it.

4. Lending Standards Are Much Stricter Now

Let’s talk about the wild west of lending that led up to the 2008 crash. Back then, anyone with a pulse could get a mortgage, no questions asked. Today? Not so much.

Lenders now require solid credit scores, verified income, and hefty down payments. These stricter standards mean fewer risky loans, which translates to a more stable U.S. housing market. 

If you’re thinking about buying a home in 2024, it’s a good time to lock in a deal knowing the system is much more robust.

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5. Homeowners Have Record Levels of Equity

Here’s a fun fact: U.S. homeowners currently hold over $29 trillion in home equity. That’s an all-time high. This equity acts as a safety net for homeowners during tough times, making it less likely they’ll default on their loans.

For context, during the 2008 crash, many homeowners were underwater – owing more on their mortgages than their homes were worth. Today, most homeowners are sitting on significant wealth, further stabilizing the market.

6. Key Markets Are Still Seeing Price Increases

While some areas have seen slight price drops, cities like New York, Los Angeles, and Miami are still experiencing price growth. This shows that demand in certain regions remains strong. 

So, while the headlines scream about a potential market crash in 2025, the reality is far more nuanced. Real estate predictions point to a slow and steady market, not a dramatic collapse.

7. Fixed-Rate Mortgages Provide Stability

Most homeowners today are locked into low mortgage rates thanks to the boom in refinancing during the pandemic. These fixed rates mean that even as interest rates rise, monthly payments stay the same. 

This stability keeps foreclosures low and prevents a flood of distressed properties from hitting the market.

If you’re planning on investing in real estate, fixed-rate financing is a solid strategy to weather rate fluctuations.

By the way, if you're looking to stay on top of market opportunities, Mailmix offers fantastic Done-For-You Direct Mail campaigns to help you connect with potential sellers in this competitive market.

8. Americans Are Financially Resilient

Here’s a feel-good story: Americans are managing their finances better than ever. Debt levels are manageable, and savings rates are up. This resilience is a big reason why the housing market remains stable despite economic uncertainties.

Warren Buffett once said, “Be fearful when others are greedy, and greedy when others are fearful.” Right now, fear is driving a lot of bad decisions. But savvy investors know that real estate investing is about staying the course and focusing on the data.

Be fearful when others are greedy, and greedy when others are fearful — Warren Buffett

9. No Oversupply Means No Crash

Remember, a true crash requires an oversupply of homes. But today, we’re facing the exact opposite. The housing inventory crisis has created fierce competition among buyers, keeping prices buoyant.

For example, in many markets, homes are selling above asking price within days of being listed. This demand shows no signs of slowing down, making a housing bubble burst highly unlikely.

10. Experts Predict Modest Price Growth

Let’s end with some good news. Experts, including Goldman Sachs housing market analysts, predict modest price increases for 2024. While it’s not the explosive growth we saw during the pandemic, it’s steady enough to reassure both buyers and sellers.

So, if you’re thinking about buying a home in 2025, don’t let fear hold you back. The numbers are in your favor.

The Truth About The US Housing Market

The US housing market isn't headed for a crash - at least not according to these ten crucial factors we've discussed. From persistent low inventory to strong homeowner equity positions, the data suggests stability rather than catastrophe.

Remember this: it's never been a bad time to buy real estate - just a bad time to sell. Whether you're considering investing in real estate or buying a home, don't let real estate myths and crash predictions keep you on the sidelines. 

The market's fundamentals are strong, and historical trends show that patience in real estate almost always pays off.

Want to know the truth? While others are paralyzed by fear of a crash, smart investors are seizing opportunities. The question isn't whether the market will crash - it's whether you'll take advantage of the current market conditions to build your financial future.