Online searches for 'can't sell house' have exceeded 2008 levels, signaling unprecedented housing market illiquidity. This indicates homeowners are struggling to offload properties amidst a slow market driven by high rates.
π§ Institutional Insight
π Whales
Whales are hedging real estate exposure, increasing cash positions, and eyeing distressed asset opportunities.
π― Impact
Negative for residential and commercial real estate, regional banks (higher NPLs), and consumer discretionary spending. Potential for MBS spread widening and flight to quality in UST.
β³ Context
This reflects the ongoing impact of elevated interest rates on transaction volumes and affordability, potentially signaling a deeper economic slowdown.
βοΈ Market Scenarios
β‘ AI Market Deja Vu
Past Event: 2008 Housing Crisis / Great Financial Crisis (GFC)
Reaction: Housing prices crashed, MBS market froze, banks faced massive write-downs, leading to a broad equity bear market and flight to safety in UST.
Reaction: Housing prices crashed, MBS market froze, banks faced massive write-downs, leading to a broad equity bear market and flight to safety in UST.
π’ Bulls Say
Existing homeowners with low mortgage rates won't sell, limiting new supply. Strong employment and wage growth might cushion values, preventing a widespread crash.
π΄ Bears Say
Persistent high rates and increasing inventory will force selling and significant price corrections, triggering a negative wealth effect and broader economic contraction.
