What will it take to get house hunters in a buying mood again?
My trusty spreadsheet examined a host of federal and industry real estate and economic stats from the past 50 years to help explain the incredibly low number of homes bought nationwide.
Consider that in 2023-24, Americans bought 9.5 million residences, combining existing houses and new homes. It’s the slowest sales pace since 1995 – when the economy was recovering from the early 1990s business challenges. The employment rate was 3.6% and mortgage rates 7.9%.
Recent sales are 21% below pre-pandemic 2019, or what some folks see as the good ol’ days. And they’re 7% below average transaction volumes since 1975.
Next, consider the latest purchasing pace against a growing national population. More people need more homes, no?
Well, recent sales equal 36 per 1,000 American households. That is the slowest rate since 1983. Yes, that’s 41 years ago, when we saw crazy days with 13.2% mortgages and 5.2% joblessness.
It’s also the third-lowest buying pace in 50 years, down 26% from 2019 and 27% below the 50-year average.
Pick a descriptive term for this real estate debacle: Flop? Plunge? Nosedive? Or crash?
