Home Prices To Drop In Half From Here? | Melody Wright

Summary

• Housing Downturn: The guest expects a deep correction, potentially 38%-50%, as median home prices realign with median household incomes and distress spreads from motivated sellers to forced sales.
• Investor Unwind: Distress among short-term rental owners is rising with sales up and prices down in saturated markets (e.g., Tampa, Atlanta, San Antonio), and institutions are turning net sellers.
• Mortgage Dynamics: Lower rates are unlikely to rescue affordability; credit standards are tightening, refinance rejection rates are high, and underwater mortgages are increasing, limiting buyer qualification.
• Rocket Companies (RKT): The pivot into DSCR investor loans signals late-cycle stress as traditional FHA demand is tapped out, raising quality and fraud-risk concerns in mortgage origination.
• Airbnb (ABNB): The short‑term rental boom is reversing, with many overextended hosts facing cash flow stress and becoming forced sellers, adding inventory and downward pressure on prices.
• AI & Nvidia (NVDA): The AI trade shows signs of narrative fatigue; Nvidia’s reversal post-earnings and inventory concerns highlight market vulnerability given AI’s outsized weight in indices.
• Data Centers: Power constraints, rising electricity costs for residents, community backlash (“No to data centers”), and reports of completed facilities awaiting power suggest capacity bottlenecks and social risk.
• Outlook & Risks: The “silver tsunami” will add inventory for years, government support may shift to affordability programs, and natural market forces are likely to prevail over extend‑and‑pretend policies.

Transcript

I think, Adam, we're going to correct all the way to a point where household median income matches uh the home price, the median home price. And so that is going to be worse than 2008. This could devolve a lot faster than last time. Um and so that could be interesting, but yes, worse. >> Okay. Uh, and for prices to fall to match or or or come in historic alignment with median incomes, finger to the wind, what type of percentage decline is that from where we are right now? >> It's going to be near your 50%. You know, and and much greater in certain areas. Welcome to Ful Money. I'm its founder and your host, Adam Tagert. Contagion has been the trend of the US housing market this year as rising inventory and weakening prices have spread to more and more metros. How bad has it become? Well, Zillow just revealed that its data shows that 53% of all US homes lost value over the past 12 months. That's the most since 2012. As we're now poised to enter into a new year, should we expect the situation to get better or worse in 2026? Well, to make sense of it all for us, we're fortunate to welcome housing analyst Melody Wright back to the program. Melody, thanks so much for joining us today. >> Thank you so much for having me. It's my pleasure. >> No, I very much appreciate it. Uh, and you're doing me a real solid here. We're recording this over the weekend uh right before Thanksgiving week. Uh, you've been on the road. I very much appreciate you making the time for the FAF Money audience. Um, but I already know you have a heart of gold, so it's not surprising, but it's still appreciated. >> Thank you so much. >> All right. Well, look, um, I just mentioned that that big stat, which is the one that really made me think to reach out to you this week, Melody, uh, that Zillow, um, you know, who is they try to be, I think, as impartial as they can be, but I think we know there's they've sort of been cheering on, you know, the the bull market and housing until recently. um that that they have admitted that you know now the majority of US homes have lost value over the past 12 months. Uh I recall from our previous conversations this year. You were one of the first housing analysts to say that or predict that uh 2025 will be the first year in a good while where national housing prices will actually decline on average over the year. First off, how is that prediction doing? Um, I know we've got over half the houses have lost value, but are we actually on track for a national average housing price decline this year? >> Yeah. So, it's a little tricky. Um, if you look at the National Association of Real Realtor series, um, they I don't know that we'll get there. Um, but I think we might get there in case Schiller, uh, which is that series looks at recorded sales. Um so uh I you know it's it's hard to say but you can certainly see the deceleration um happening in home prices and where we'll also get there Adam of course is on the new home side. So that will be very clear. But the biggest problem and and one thing and I'm not going to get too excited because last year in December we really saw sales kind of uh rev up. Um and so I had hoped that would carry through 2025 uh so that more people would want to transact in the market. Instead as rates kind of went up again um the market just froze and then we had kind of the April terror te you know tariff terror or whatever. I think people got really cold feet and so sales slowed down again. Um, and so we aren't having enough transactions to really uh in influence that median home price in the NAR series because it's only those higher price homes that are transacting like really higher price. Like you can see year-over-year the increases are con always in the 1 million plus category are the 75,000 to 1 million. And so what you've got again is something we talk about all the time, the bifurcated housing market, but the majority of folks transacting are in those upper tiers. So your median is going to be higher. However, what I've been seeing over the last three months, and this is why, you know, I get into the dirty dirty details is underneath the covers, that 100 to $250,000 uh sales price, we're starting to see incremental increases in sales in that category. And so as that continues um we we'll start to drag the median down and it's happening already and and that's what you're seeing the deceleration. And so that's a very long answer that um I it I think people are going to end the year sort of it'll probably be around flat um slightly down um but as Zillow said uh you know the values are down it's just that we're not transacting we're not selling them and so we're not realizing uh those impacts. >> Okay. And so um what what created this this frozen and we have a bifrocated market you mentioned but we also have used the term frozen a lot right because there are so few transactions on a relative basis and really what caused that was um we had abnormally low mortgage rates for many years. Uh and then uh during the COVID era, we had a ton of stimulus and everybody was moving and I I I I I I now don't need to live in a city cuz it's going to be work from home forever and I can go live wherever I want. Um so prices started zooming higher because of those two twin boost to demand which is, you know, hey, I got some extra money right now and also uh I really want to get out and live in my dream area. So, um, prices went bananas and then inflation kicked in and the Fed said, "Hey, we got to start we got to start, uh, constraining this. We're going to have to jack interest rates up." So, people could see that coming. [clears throat] And so, they locked in homes as as quickly as they could before they were going to get quote unquote priced out by rising mortgage rates. Okay. So now we got to this point where now housing prices ele art artificially elevated, mortgage rates super high on a relative basis. Those who own homes don't want to in fact in many cases don't feel like they can transact, right? Because they're they're quote unquote trapped by their two or 3% mortgage. They're they're never going to get a deal that good if they sell their current home and and and go buy another one, right? Um now obviously too you know um people got impacted by the higher cost of living and whatnot and so people's ability to pay has gotten injured. At the same time we've seen the cost of ownership skyrocket. So insurance, property taxes, maintenance, right? So this is all just basically the soup that's created this environment where histo based on historical basis we've almost had never had a population percent of the population as large as it is right now who can't afford to buy the average home right now. So the only people who can transact are the wealthy right and that's why you know we've got fewer transactions but they're much higher priced homes because it's only the wealthy that can can participate here. So obviously this is not healthy at all. It obviously skews the data, right? So people will say, "Well, housing must be doing okay because, you know, home prices are still hanging in there, but for all these reasons, it's really giving us a very misguided signal. So the question, as you and I have been talking about now for better part of a year, is okay, well, what's going to what's going to uh solve this for us? Is it going to be lower mortgage rates, which I'm going to ask you about in a second?" Um, or is it going to be just more transaction volume that starts to bring up more transactions at the lower end of the market? and that mathematically will bring uh the prices down. And then of course there's just the the hey maybe we just need lower prices here which obviously I think is the answer. I know you think [clears throat] similarly too but let's start there with the mortgage part. So 30-year fixed mortgages they have come down a bit over the past year um but from about 7% at the high to about 6.2 6.3 I think right now. >> 6.3 right now. Mhm. >> Yeah. Okay. So, um, that doesn't seem to be enough to be unfreezing this market. Um, do you expect them to continue following next year, especially as the Fed is, you know, promising to or or hinting it's going to keep cutting uh a bit more going into next year? Should we do you expect mortgage rates to get low enough to really provide any real relief here or do they need to go down a lot more to be real really material to the equation here? >> Sure. Let me just add one other tract to where we are and that is the amount of speculation cuz a lot of it wasn't actually first-time home buyers who were getting in on these low interest rates. It was actually the speculators. So when they thought, "Oh, I can work from anywhere. They would move to that place, buy their home, and also buy a second home." This this happened a lot in Texas with all the tech uh influx there. Um and so I just wanted to mention the speculation aspect as well. And and what's the worst of the speculation? Is it the person who bought another home as an investment home to be, you know, a landlord in addition to their regular job? Was it the Airbnb speculator who said, "I'm going to buy several of these things and become a passive cash flow millionaire. Or was it the institutions who we know who were buying in bigger percentages than they had in past boom cycles, uh, who are hoovering up the single family home inventory?" >> All of the above, right? >> All the above. Are they all equally guilty or is there one that stands up? >> So I think the institutionals were way guiltier like in 2012, but you know and guilt is a relative term and because the government asked them to come do that. Fanny and Freddy begged them to come in and buy these homes. You know, we might even see uh the government have to buy some of them back when people start crying loud enough. Um, and so I think they they started really in 22 starting to sell and and if they didn't sell right into the market, what they did is sell to one another to try to sustain their prices, but now they've become net sellers. Um, and I think I mentioned to you I met with one of the largest of those uh who a guy who heads the asset management department of the one of the largest uh told me they are as soon as leases are up they're rehabbing and offloading them because they they can see what's happening in a lot of these problematic um locations. So I think it was more your your folks who first they probably started off with a long-term rental and then they walked into a bank um and the bank said why why do that? you should do short-term rental because instead of $1,500 a month, you can get like $10,000 a month. Don't you want to do that? And by the way, why don't you buy 10? So, I think it's probably we probably sell more of that uh the Airbnb short-term rental is the biggest culprit at this point in time, but it's all cumulative, right? And then another track that we have to mention is of and then I will promise get to mortgage rates is that the government intervention here because um although it's mainly those really top tier people that are transacting the ones that are transacting at a lower it's not really lower because they're getting down payment assistance they're getting an FHA loan at with three and a half% down but they don't have to pay that three and a half% because there's a ton of down payment assistance programs around and so they're sustaining those programs through the government. And so, um, but I I think so it's it's it's a really toxic brew. And then you also have the boomers, of course, who are holding these second homes who it's not like an immediate decision. Oh, I've got to sell this today, you know, for a lot of them. They could they don't have they can take their time to sell it. So, just wanted to add those two points and then I can talk about mortgage rates, but if there's something you wanted to say to that, >> uh, I mean, [sighs] we could talk an awful lot about this for a long time. Um, [laughter and gasps] no. I mean, I guess um let me just say this on on uh both the Airbnb side and the institutional side. You know, Melody, you and I have been talking for several years now, you know, before this contagion that we're talking about started. Uh and two of the things that we forecast um about this sort of um investor ownership in single family homes was that if and when this thing turned, you were going to get a bunch of um uh these Johnny come lately landlords who got, you know, uh siren songed in or suckered in, however you want to say it. Good way to put it into buying all these these uh rental properties. uh they're all of a sudden, you know, kind of at critical mass going to be forced sellers to say, "Hey, wait a minute. Look, this thing was supposed to put $10,000 a month in my pocket. I'm now losing thousands a month, thousands of dollars a month in cash flow. I get to unload this thing." Um similarly with the institutions, you know, buying up sometimes hundreds, sometimes thousands of properties in the same metro area, >> right? >> You know, this isn't the the roof over their heads. This is this is somebody's Excel decision, right? And so if if the Excel, you know, they start realizing, you know what, this was supposed to be at the end of the day net net green for us, but it's turning out to be net red, then screw it. Just just dump them, right? And that can really result in a lot of inventory coming on in a market and downward selling pressure. >> Are we at that stage with either of those two parties yet? >> I think we are at that stage in certain locations. Uh we're at that stage in Atlanta. We're at that stage in San Antonio. We're at that stage in Tampa. Um and then for the Airbnbs, uh you're seeing it and um so what's fascinating, you know, I track 85 cent cities and and that is combination of your largest markets plus a lot of these really smaller short-term rental explosion markets. My sales are always higher than say, you know, the national average because what and what we talked about at the beginning of the year is that we had seen motivated selling in 24 and this year motivation was going to turn to distress. And Adam, I mean, you are starting to see in those short-term rental markets sales up um and uh prices down and so you're you are definitely seeing motivation. And then now we're looking at markets where sales are down and prices are down year-over-year and and that's happening in those short-term saturated short-term rental markets. So, I I believe that it already is happening. um that the scale is just going to increase uh and it's going to get I think the spring of 2026 is going to be very interesting because the other thing is on the FHA side which we talked about is those guardrails went in place on October 1 and I'm already seeing in client books that when people are getting their foreclosure notices they're turning around and they're slashing prices and they're selling as quickly as possible. In addition to when I was at that conference, we heard of short sales exploding, meaning, you know, they know they're underwater, but they've got to get out. Our national statistics just hide so much. Um, and you know, but when you're seeing these local areas this distress and then you know that there are areas just like this across the country, you know, the contagion is going to spread. >> Okay. So, you expect this this we'll talk about the housing market in totality before the end of all this, but but this thing of of sort of distressed investor sales. Yes. >> You're expecting that to get worse from here. >> Oh, definitely. And but it's definitely started, but it is going to get a lot worse. >> Okay. All right. So, it's already game on. Um All right. So, mortgage rates here. So, yes, [laughter] >> big big question. Will they actually provide relief next year or is it going to be more of the same sort of you know this this disappointment that they're just not coming down as far as as fast as as trapped homeowners want them to be? >> Yeah. So, I think the as I'm going to say something really stupid, which is the bond market's very complicated, right? And I think that anybody who really thinks they know exactly what's happening. Um, but I think what we do know are there are a lot of levers that, um, Japan can pull, China can pull, uh, if they come under stress. And we're seeing Japan kind of come under stress right now. Um, you know, there's also this big, um, you know, short trade in the bond market that could unwind. And so there's a lot of things happening at once. But what I can tell you is that we have just been skating along at this forehandle for a very long time. Um and and it doesn't matter what the Fed does. Every time they cut, you know, the bond market just ignores them or gives them the finger, whatever. Um so I I don't think um unless you have a massive kind of draw down uh that rates could get material lower here. And I think, you know, the Fed itself, I believe, just I think it was one of the um Fed boards came out with a study about they believe that buying NBS is what inflated the housing market. And so I just don't think that the Fed would do that again. But by the way, even if they did, it didn't help in 2009. And so I don't see rates getting to a point low enough to make a huge difference because you do have such a large percentage under that 4%. Um, and so it would be it would have to just hit the floor. But then Adam, who's going to afford it? I mean, you can look at that the Fed just came out with its summary of consumer expectations and the mortgage refinance rejection rate was higher than I think it was like 42% the highest that we've seen in a series. So, uh, people can't qualify with those student loans, uh, reporting now. Um, with layoffs hitting the white collar sector, I just even if rates got that low, you're going to find fewer and fewer people able to qualify. And we're starting to see underwater mortgages increase as well. So, they're going to be stuck. >> All right. So, on that last point there, um, people's ability to qualify. Um, you know, what what turbocharged the housing bubble 1.0 was the fact that all sorts of people who had no business getting mortgages were getting them. Um, I think, don't let me put words in your mouth, but I think in the everything bubble, which now includes housing bubble, too. Um, there has been a lot of that going on as well. Um, particularly on the government, the FHA loans and things like that. You're nodding vigorously as I'm saying all this. Um, are we at the point of the story here where the lenders for perhaps a whole variety of reasons, both just weakness in the housing market, but also, you know, we're starting to see the consumer struggle under other types of debts like student loans, which we've talked about. um whether it's because of, you know, some of the defaults we're now seeing in the private credit space, you know, are the banks starting to become more conservative in terms of uh who they're willing to lend to, meaning they're tightening their credit standards, and is that another factor going on here, which is, hey, it doesn't even matter if you want to buy this house, you can't qualify for a loan to get it. >> Yeah, I think that's been happening for some time. You can see Rocket just put they're a big non-bank lender. They just put out Rocket mortgage um announcement. They're getting into investor loans debt ser debt service coverage ratio loans which tells you where we are in the cycle because they've run out of the people they can get through FHA. They've so now and and I mean it happens the same every it's so wild. Uh but they're now they're going after the high quality investors, you know, with those high credit scores and theoretically a lot of money in the bank. They think that's going to save them because they've run out of everybody else. The problem is they don't realize that a lot of those people that were getting those loans weren't actually qualified. They were just doing a lot of tricks. Like it's real easy to keep the same $10,000 in your on your in your bank account and pay it out every month and have it come back in. pretend to pay it out cuz we are doing things like bank statement loans already. [laughter] And so, um, there's just not going to be the appetite that the Rockets of the world think there's going to be, but it is a sign of where we are in the cycle that they're now getting into something that they everyone in mortgage promised they would never do again. And so, we know where we are now. >> Okay. So this whenever I talk to you Melody, I always feel like I get, you know, yet another uh dimension of this situation that I didn't fully appreciate before. And the the term that's in my mind right now is sort of perfect storm. You know, we've got we've got um prices too high, we've got borrowing costs too high, we've got tightening credit standards, we've got distressed sellers in a lot of these areas that we just talked about. Um, we've got record unaffordability. You know, the the the younger generations just have pretty much given up hope of of ever being able to buy. Um, we've got the the the cost of home ownership have skyrocketed, which should be putting downward pricing pressure on prices anyways. Um, I mean, I I'm kind of losing track of all the arguments here for why housing um may continue to suffer going forward from here. So, uh, you know, g give me the headline here for 2026. I I know in I know in the past you've you've made a bold statement that you think that this housing downturn may actually be worse than the GFC. Um, if that's still true, h what's the sound bite here? If somebody said, Melody, you know, where's this all going? What would you say? Yeah, it's going to be worse because what happened last time was we were we were on our way down to where household median income would actually ma match um home median prices. We never got there because Wall Street came in to buy those. But now they're crying on TV. I don't know if you've seen some of the clips, but there's been a big large institutional out there saying, you know, listen, we didn't want to do this, but Fanny and Freddy and FHA begged us to come in and buy these homes. And so you can already see the narrative. um that they're they're going to start crying a lot louder soon and say, "Hey, we saved you, government." Um and so who's the buyer now? Um you know, and I've talked on your show before that I think actually the government might become the buyer of last resort here, unfortunately. Um and and then use certain affordability programs, but I think, Adam, we're going to correct all the way to a point where household median income matches uh the home price, the median home price. And so that is going to be worse than 2008. And I I can't you you were saying many things, but I I think you included property tax and insurance, but >> I did. >> Yeah. What you're you know what we just saw in Boston and Chicago is that you know where these people were not where where I'm sorry people these municipalities were not getting revenue anymore from commercial real estate. they had to go to their homeowners and increase property taxes, doubling many areas of Chicago. Um, this just recently happened. And I think you're going to see more municipalities try to do something like that because they're all in a budget crunch. And so, yes, I think and by the way, this is the other tricky thing is that in the last cycle, um, remember how many alcash buyers we've had, right? Uh well, when these aren't on a [clears throat] bank or non-bank's balance sheets, um there's nobody that's going to be cutting the grass, there's nobody that's going to be winterizing that home, uh taking care of the mold problem, which all if you have if you service alone, you have to do all of that. And so I think we could see um this kind of like de devolve into chaos a lot faster than we did last time as many and the investors uh abandon these properties which you know we're already starting to see like if you look at the FHA loan performance trends and they have categories for the not the you know what's why is this 90 plus delinquent and one of those categories some of them are unemployment illness things like that but one of them is called no contact and what that is is when you cannot get in touch with that person. Now, prior to the GFC, that would have been a lot of people who were scared to call in and talk to their serer because they were embarrassed about what was happening. Um, and it would be your investors. Well, now it's a lot less because I read servicing notes all all the time. it's a lot less uh it's you know uh that it's investors that are walking away and you're starting to see those numbers just they doubled I think um you know from last year and so this is this could devolve a lot faster than last time um and so that could be interesting but yes worse >> okay uh and for prices to fall to match or or or come in historic alignment with median income finger to the wind. What type of percentage decline is that from where we are right now? >> It's going to be near your 50%. You know, and and much greater in certain areas. Um so, you know, let's say so probably about 38% honestly, but um you know, right? It's when you look at current median income. >> Okay. So, that's that's losing a limb. That's not a that's not a scratch to this market. >> Okay. Right. >> Right. Now, we could all get, you know, wonderful highpaying jobs soon, right? To keep that from happening. >> Well, I we [laughter] look, trust my sister, I can take that argument over into the stock market as well. Um, which is, hey, yeah, everything magically gets better if we have uh, right, you know, a resurgence in growth and real wages go up and all that stuff. >> Exactly. Exactly. >> But I think you, like me, are looking at the the landscape trajectory and saying, I'm I'm just not seeing that. Yeah. that that hero ride to the rescue anytime soon, >> right? >> Um, all right. So, you talked about the fact that the US government might become the buyer of of last resort here. Um, and we've seen some proposals being floated. Um, some might say creatively, some might say frantically um by Bill Py, who is the the head of housing now under the Trump administration. One of the things that was tossed out there was the 50-year mortgage. I know you've gotten a ton of questions about that and I'm I'm sorry to have been one of them that pinged you for a second. I heard that. >> Um let's start there with that one. Um I get the sense from you. You think that's that's not that big. It's kind I don't want to say it's a nothing burger, but it's it's not something you're too worried about. Is that more because of its actual implementability or just even if it's implemented, it's not going to make that big of a difference? >> I think it's all of the above again. and just, you know, I wanted to ignore it when I saw it, but people would not let me because I was just like, this is a nothing burger one because we already have 40-year modifications. So, uh, and they've been using those for a couple years in FHA, and I'm seeing people fail out of those because honestly, what happened there with the 40-year modification is, um, you would go to try to modify that loan, but because your property taxes and insurance had gone up so much, your payment was actually higher, you know. So, uh, even extending the period out and and you know, when you look at the amortization schedule, you're not saving that much every year and the amount of interest that you're paying in is crazy. But also, back to what you and I were just talking about, people aren't going to be able to qualify. They're just not in a position to qualify for these higher priced homes. And so, I do think it's a nothing burger. If they instituted it, it would be terrible. Uh, I would I would I I'll call that usery all day long. Mhm. >> Um, you know, in the first 11 years, you'd pay 253,000 in interest. You would have not only paid your home down by 5%. And so, by the way, 250,000 is what I think median home prices should be around, right? So, that's that's crazy talk, right? We've got to think of >> in that example, what was the purchase price of the house? >> Oh, 400,000. >> 400,000. Okay. >> 400,000. I mean, post post any down payment, but nobody puts 20% down anymore. I mean that does, you know. So, um, but yeah, it I think it's a terrible idea, but just like, um, uh, you know, when they were going to do the Freddy second lanes, I I don't think that it would have that much impact, but it's still a form in my opinion of debt slavery and but it's certainly not going to uh to to get us out of the doldrums. >> Okay. So, so in your mind, it's it's kind of pushing on a string, meaning even if you offer it, most of the people who want to get it aren't going to be able to qualify for it anyways, >> and it won't make that big of a difference, and it just makes things worse from a societal standpoint, you create this generation of debt slaves who are Yeah. Okay. All right. Um, the other thing that that's been floated recently has been portable mortgages. Um, and I I don't know if assumable mortgage I think I've heard assumable in there as well. Um, I don't know for certain if that's assumable is being super pushed right now by the administration, but let's just talk about those real briefly. So, if you either had the ability to take your mortgage with you when you sold house A to buy house B, >> um, how realistic is that? And then two, you and I, I don't know, a year or so ago, I I kind of got real interested in assumable mortgages for a hot minute. >> Um, do you see that as actually being potentially part of the solution here? Well, it could have been uh you know, but it's like in practice what's happening. So, I have a really good friend, Mark Mcdana, who has an assumable mortgage company. He's been in the business for 30 years, and you know, he and I talk often, but I gave him a call after the last, you know, brewhaha in the press. And he's like, Melanie, they just they won't do them. The servicesers won't do them. like we can't like he's sending complaints to the various DOJs uh because the servicesers they're just not set up to do them. Um they're not incentivized really to do them. And so procedure this so you got to think the mortgage market is like the worst. It's like the DMV but way worse. Okay? And it is it's built on 1968 technology. They cannot change any attempt to change it has failed miserably. And this is your big banks as well. And so they just can't structurally get it done or get it set up. Now, could they do it if there was enough um sort of motivation? Sure. But we're not seeing that from even this administration that's throwing them out there. The portable I I have to laugh. You I mean, I'd be down with it because it would take the entire securization machine down. I mean, you can't do that. I mean, you're you're lending that that that that loan is a security in a as you know, it's it's the collateral in a mortgage back security. And so, you know, and that's tied to the home. So, you can't it it's impossible. And and so, um >> because your collateral changes, >> right? Exactly. And so, you're you'd have to buy it out of the pool for sure. And then, of course, you're not going to get the same term. I mean, it's so it it's not even to me that one is a non-starter. Now, I'm all for uh getting rid of the securization machine. I'd be the first one to sign up. Then we can talk about some of these solutions, but that would that would that would be uh unraveling of the entire mortgage box security market. >> Okay. So, it sounds sort of like a almost an idealistic ideal idea at this point in time, right? which is like, hey, if we actually tried to implement this, it would break the whole system. >> Yeah. Spaghetti at the wall. >> Okay. Um, let me just ask you this. So, somebody said to me, um, which made sense to me, which is, hey, no, this would kind of, you know, ruin the banking system because the banks are making these loans essentially betting that you're going to sell your home within seven years. >> Seven years, 100%. Yeah. So if if these were assumable or portable, well then they they'd be much more longived and that would blow up all the banks models. Now I don't know if that's I mean I get that. I don't know if that's super true because talking to you, you tell me, hey, these banks make these loans and then they just flip it right away to somebody else. But of course that somebody else is still assuming that that >> right >> the life of that loan is only going to be a certain amount, right? And they generally flip it to the government from what you've been telling me. >> 100%. Yeah. So yeah, and so then of course rates would have to be higher. I mean there's so these are to me these are just things that are being thrown out to make it seem like we are talking about solutions. Um and you know at at every turn there's going to be a bad guy. Um you know oh it's the servicesers they won't do the assumable. Oh it's the banking industry they won't do the portable you know but none of these are viable solutions um at the moment. >> Okay. So again, don't don't expect just like you you're not expecting mortgage rates, lower mortgage rates to ride to the rescue anytime soon, you're not expecting some bold, you know, government policy to come here and all of a sudden uh unlock a lot of affordability for folks. Well, what you can see they've recently passed through committee and and I think it's going to is a lot of these um housing affordability initiatives that are more like um you know assistance at certain adjusted gross income. Um, and so I think that's that's the plan is it's going to be a lot of uh, you know, housing affordability, nonprofits out there similar to what you see in Rochester, buy the block where investors can come in, buy up the block, rehab, put lipstick on a pig, and resell it. That's that's their plan right now is and so what I would probably imagine is that when the builders get in trouble because they're going to is that and and also the institutionals that if if the government does buy up these homes or through its asset manager Black Rockck decide to buy up the homes you know um that they would have these programs where it be like okay if you make $50,000 a year then you're eligible because that's a certain percentage less than the median income then you're eligible for certain type of assistance. I see more of that coming than anything else. >> Okay. Let me ask you this. [clears throat] Um when a an asset price bubble has been blown, particularly um in an area that is, you know, deemed essential to the economy. Um and especially when the government has had a hand in blowing that bubble, um the the operating procedure becomes extend and pretend, right? We just do everything we can to just try to keep prices where they are, right? Instead of stepping back and saying, "Whoa, we deformed natural price activity here. We should just let all the froth get out of this thing, get down to a sustainable baseline, take our lumps, but then we'll be better." The playbook is always the reverse. What can we do? What can we possibly imagine to try to keep prices where they are here? So, we're talking about a a bunch of ideas that may not work, but to your point, there's probably going to be a lot of additional spaghetti they're going to throw at this wall. In the big picture, when we're having this conversation, say 5 years from now, uh Melody, what do you think will win out at the end of the day? Will it be the natural corrective market forces or will it be the forces of extend and pretend or will it be a day tant you know maybe 50 50% one side 50% the other so we get a half correction but not a full correction >> five years from now and just remember we've been extending and pretending since 2020 so we we're in year five right now you know >> well I mean I could say we we we we started extending and pretending back in the early 2000s we had a little blip in PFC and then continued it. >> Okay, fair enough. That is fair enough. In this cycle, um five years from now, you know, the silver tsunami is going to be um pretty much I think all of us are talking about it's going to be everything we're talking about in government. It's going to be everything we're talking about in housing. And so, uh I think the natural forces will win out. Uh unless there's natural disa disasters that, you know, destroy all the homes, like we are just going to have way too much inventory. And so I think five years from now um that there's there's not really going to be anything that's going to stop the train. Now, could there be areas that do way better than others? Sure. Like I think Tennessee is going to be a state people come to for a long time. You know, >> that's cuz everybody wants to live near me, right? Yeah. No, it's Yeah, it's the taxes. Um you know, I've had several people on X after the whole Chicago thing. They're like, "Is there a hobby for him?" like I said, I'll, you know, I'll do a special on this area, but um yeah, I think the market forces will win, but of course we I mean there's so much that could happen, Adam, between now and then. Like we could go to war. That could change things a lot, you know. So, but still, I don't know how you get around um kind of the supply issue that's coming. And then also, if we don't fix uh the job situation, the demand. >> Okay. So there's an old saying um when you have imbalances that um reality bats last right that you can ex you can you can do everything you can to try to you know distort everything but at the at the end of the day ultimately reality generally steps in on its own terms and what I'm hearing from you is you think we are far enough in in this baseball game here that reality last bat is is coming and not saying it's necessarily next year but but you you feel like that is when the dust settles here that that that's going to be what it's going to be those natural forces that went out. >> Absolutely. >> You and I are going to be talking about, you know, uh Great Housing Mobile 3.0 in 5 years. >> I, you know, for a moment there after the BBB was passed. And I was like, well, maybe we'll have a little blip up. I I just I don't believe that anymore. I think we're at a a place structurally that it's just so bad that uh market forces will run out. >> Okay. All right. Um you mentioned this a couple of times. I know we've talked about this once or twice, but I want to just flip it here. So when you said silver tsunami, I think everybody understood that, but just for those that might not have, that is the aging of the baby boomer cohort. And um Melody and I have been talking about this for a long long time. um that eventually we're going to hit a point where instead of 10,000 boomers hitting retirement age every day, 10,000 are going to be moving into the nursing home or moving into the cemetery uh as they age out. Um and last time we talked Melody, you sort of shocked me by saying think that's actually started. It's now no longer academic. We are at the the in the first inning of that if you will. Now, this is going to be, as you said, like a 20 plus year um event that that's only going to build steam from here on. So, okay. So, that's going to be no matter what happens otherwise with the housing market, that's going to be adding more and more inventory as people are having to leave their homes for one reason or another, right? And in most cases, uh, when a boomer or an aging parent passes their their home along to children, if they have them, if they've got multiple children, most of the time that house gets sold because the kids can't determine who should take the home. So, let's sell it. Let's split the prices. >> Right. >> So, okay. So, tsunami of inventory coming onto the market for years and years and years after that, right? >> So, let's combine that with some of the things that you just mentioned. You know, cost of ownership, home ownership has really skyrocketed. um people are are struggling to afford the homes that they live in. Um investors are looking to get out and dump these properties on the market. So I think probably about a year ago or so we were talking and I pulled a stat that said I think it was the average the the the average age of a of a home in the US had just passed 40 years. Right? So these wooden boxes that we all live in are aging, right? Um as people get more economically distressed, obviously they can afford to do less maintenance. >> You you then have these, you know, institutions that are saying, "All right, look, I'm planning on selling this thing, so I'm going to defer as much maintenance as I can and just dump it on whoever's going to buy this thing." Right? >> You've got a bunch of boomers who are like, "Look, I'm I'm old and concerned. my money's going to healthcare or whatever at this point. I'm not going out there and paying someone to do this. I'm certainly not going out and fixing the gutters myself. I can't at age 87 or whatever. Right. >> What is What are your thoughts on just like the the quality of the condition of our national housing fleet? [laughter] >> Is that a concern to add to the table here? >> Well, I think so, but but it's a it's a concern for those home prices because and and that's what we're seeing right now. This is why you've got the rage d listing as my friend John Brooks says. It's like they they the the the boomers um will list it and when they don't get an offer at their price or they get some ridiculous offer, they like delist the home and rage and they've done no repairs to the home. And so I think that this becomes a real drag on home prices as well. And and what you are seeing is you're getting a lot more realistic appraisals now. um when you're in these manias like you can sort of justify an appraisal that's coming in and hot because you can see all around you that home prices are accelerating and so >> and really square footage dominates everything else, right? >> Hey, you've got this you've got this plot, you can do anything you want with it and it's hot. Everybody wants, you know, >> the plot the plot in this area, right? >> Yeah. Exactly. >> Once once that mania starts to cool off, you really look at the quality of that square footage, right? >> You sure do. and and it and things can be found that weren't found even when you sold it. I've shared that example a couple times here. And so, yeah, I think you have an issue with home prices. Now, some people have tried to argue, well, we're going to need to replace all these homes and there's but we have built so much new supply and now some of that's pretty crappy, too. I again, I just think these are factors um but they're not going to change the trajectory. that if there in this case the fact that people haven't done and what also happens a lot of investors bought it in 2122 and then couldn't afford to rehab that home and that's what I see a lot in Johnson City Tennessee they're just sitting vacant not rehabbed um and so I think the trajectory is that's actually going to pull down home prices even more >> okay yeah all right so that back to my kind of perfect storm comment earlier like this is just yet another headwind that we're throwing into that tempest Exactly. >> All right. Wow. We're really uh we're really making people feel really optimistic. I know the housing market. Um I know. Okay. So, a couple other quick things uh that have made headlines. Um >> trying to figure out which way to start with this. I guess I'll I'll I'll take this trajectory. [snorts] So, um I just saw a headline that said the median age the median age of all home buyers including firsttime and repeat buyers. So, this is this is the whole soup. Um, has hit an all-time high of 59 years per the the N, >> right? So, this isn't this isn't some Melody Wright out there in her little corner of of the internet saying this. This is the [laughter] N admitting that >> that blows my mind. The the median home buyer is 60 >> at this point. >> Yeah. And part of that goes back to your your the affluent can buy and and and affluence is correlated with age. But I mean that society what does that say? How concerned does that make you that that that >> very >> Yeah. >> very concerned. I mean it it's very this so it's funny. I got asked on a segment, you know, do you think this is worthy of a national emergency? And and and I, you know, in my mind I say no in terms of government involvement, but as a society, this is a national emergency that people need to wake up and realize that if we don't address this problem because I think you and I talked about this briefly in another show, you know, um the younger generations are much more comfortable with violence than the older generations. And I think, you know, we've seen escalated violence and as a society, if our younger Americans don't have hope, then all kinds of ugly things are going to happen. >> Um, all right. So, let's take this into a a direction that maybe folks aren't expecting, but we were talking about this before we turned the camera on. Um, so one of the things that is making home ownership more expensive is the cost of electricity. And that cost is uh getting pushed higher and higher in a lot of areas because of the craze to build data centers to power AI. Right. And data centers are are often times sort of sold to a community as hey this is going to create some jobs. >> Jobs five. Yeah. >> Yeah. Exactly. So the the the few in the community who can go build the data center. Great. They they get some work for some period of time. Everybody else gets stuck with with permanently higher electricity bills. Right. >> Um I actually put out, this is a couple months ago, but I I put out an idea on on X where I said, uh, man, has anybody put in a poly market, um, bet yet for when the first data center is going to get burned down by, you know, angry residents. >> I'm sorry, I don't mean to laugh, but but [laughter] I I I find it funny G's humor wise, because I actually think that's probably going to happen at some point. Like I think that's a pretty safe bet to make that at some point here >> uh locals are going to get so angry they're just going to you know get some bats and and take it out you know some gasoline and take it out and and I'm not I'm certainly not advocating this folks but um but you know what are your thoughts about that and this trend here? I mean, it it just seems like if you are a a I don't want to say a homeowner because renters definitely are are getting hit from this, too, but if you I if you're a struggling um home dweller, uh the the hits just keep on coming, it seems. >> That's right. And and you know what's interesting too, Adam, is you know, when I drove and I still drive, right, uh all across the country, you can see a lot of new empty data centers. Um, you know, I shared that on X- Twitter and people challenged me. Um, I actually briefly worked for a company where I was building a data center directory. Um, so I I'm I'm very familiar with what these things look like, how they operate, and and you could tell there were a lot of new construction completed um and why well the dirt around it, but also the for sale or for lease um sign. And you know what happened right after I did that tweet? We hear that there are data centers that are fully built but can't come online because they don't have the electricity. One of them was an Amazon uh data center. And so I think we've already overbuilt in this area similar to the way we've overbuilt uh in housing, but nobody knows it yet. But to your point, the other thing I've seen all over the country are signs that say no say no to data centers. And and these they they may have a Trump sign in their yard. They may have a Biden sign uh but they have a no to data center sign. And so I think that the country is united in the fact that they don't want these data centers. They don't want the increased power costs. They don't want their water being sucked dry. Um and again I must rem remind people that when these people come to town and make these promises to you, they hardly ever happen. Let's take Micron up in uh New York right now. uh this was a this is the reason all those investors went in uh into the northeast like Rochester and surrounding towns and bought up all these homes. They thought Micron would bring all these jobs. We're now looking at a three-year delay. And so it's a lot of promises and no delivery. And so I do think on the one hand we've got a data center mania that we've probably already built for. But on the other hand, I totally agree with you. People understand that this is why their electricity bills are going up. And there will come a point when the baseball bats come out. >> And this is kind of interesting too. You know, I spend most of my time on this channel these days, Melody, talking to, you know, financial analysts about uh the AI um boom and and just how sustainable it is from from a whole bunch of dimensions, right? From from obviously a stock valuation dimension, but from a capex, can we just continue to keep throwing this much money in at the pace that we're doing it in? And obviously you know part of that is dependent upon having the power uh to to fuel these data centers. Um this could be a constraint in the system that is underappreciated here which is this sort of you know um aggressive nimiism where people are just saying look I I don't want it here or I'm it's here and I'm fed up with it and we're taking it offline right and so you know it it it does seem that when people are are doing their calculations of how high AI can go and a lot of people are arguing hey it can still go a lot higher there are potential risks like this or constraints like this that aren't in their formulas. Absolutely. And and it just feels like hardly anyone's paying attention because the mania is just so I mean all we see are, you know, everyday pictures of um the administration with some tech bro or a big dinner where they're and you know, oh yay, another open AI investment. Whoops. Oracle, you know, or you know, all the roundtpping and the you know, different. So, we're in an absolute mania, Adam, that I believe once it's all said and done, it's going to be very mechanical Turk like where we realize um and for those that don't know that it was in the 1800s, a robot was built uh to play chess. Um, and he would go on exhibitions all across the world, but in reality, there was someone in the robots. >> There there was a small man inside, >> right? And so that's what I've seen in fintech as well. Uh just uh yesterday another company came out and said you thought you were talking to a chatbot. You were actually talking to a room full of 700 Indians. Um and I think that's a lot of this technology actually. Now, I'm sure in places like Open AI and these uh the tech ivory towers or whatever that they're doing they're trying to do real technology, but you've got several AI critics out there very well known saying we've reached the limit of what LLMs can do. And I firmly believe that and I feel like we reached that in 2022, Adam. And and so I think what happened from there is narrative just took hold and it was the train that everybody got on right after SVB uh you know in the lastium of of this cycle. But when all said and done I think this uh we are we are in pure mania. No one's really thinking this through. But what's interesting to me um and just the reading I've done is that uh the people are against this. You've got mom groups out there, you know, advocating to get this off phones, to get it, you know, to get phones out of schools and things like that. And I think we might see a counter sort of uh insurgency of the people who are like, we're this is you guys can put this in the news all day long, but none of us want it. So, go pound. >> So, so to the person who's watching this who's saying, Melody, come on, stay in your lane. You're a housing analyst, right? What do you know about AI? First, I just want to let folks know that you've actually trained large language models. So, you actually know of which you speak. Um, but just not to get ratold on people saying, "Look, you know, does Melody >> well, we will. >> Should we trust her as much in AI as we should on on housing?" Um, let's just assume for a moment that you are right. >> Okay. Or or let me just put it this way. Let's just assume that the bloom comes off the AI rose for one reason or another. um hard to imagine that a repricing of the AI stocks wouldn't send shock waves through the stock market because those stocks make up such a huge percentage of the market value of the overall uh markets and you know they're in almost every ETF and this this would cause Mike Green's passive capital flow with the giant mindless robot to start flowing in reverse right so it is really hard to expect that that could happen without a pretty large negative wealth effect on that affluent class that owns financial assets, right? So that would be yet another probably not just material but probably pretty serious additional headwind to throw into our tempest soup. Correct. 100% >> and it's the only reason we stayed frozen this year is that mania >> for housing [clears throat] >> because that that that affluent cohort has been doing so well >> and they've been doing so well. They've seen their returns. They are able to rage delist right if if they weren't seeing such great returns in the stock market. They would be much more incentivized to get that home listed and sold because they would be needing that cash. And so, you know, it and it wouldn't be just this um, hey, why am I paying this so much for electricity, house cleaning, all this stuff, I don't even go there and I'm talking about their second home. It would actually be, hey, I need the cash and and so, yes, if the bubble even, it doesn't even have to pop fully. I think it just has to deflate. Um, then you're going to that's also going to add to our perfect storm. So, you know, it's interesting and you don't have to share this opinion, but like I can't think of a time when so much of the world's future, at least economically, revolved around a single company. Um, so you know, right now everything is revolving around the AI sector, right? But but there is one supreme company in that sector, which is Nvidia, right? And sort of >> who replaced Enron on the SMB. >> Yeah. Well, yeah. And but I don't even think the world knew it revolved around. No, exactly. >> I think Enron was just the Jenga piece that people didn't realize was as destabilizing. But like >> I think the world really realizes that hey so as goes Nvidia, as goes the AI space, as goes the AI space, so goes the financial markets, as go the financial markets, so goes the right, I mean just everything is is around this and and I mentioned this just because folks I have no idea will probably markets will probably eventually have their Santa Claus rally and and the year, you know, stronger than they are right now. But we just had a potentially really meaningful moment in the markets. I'm sure you watched uh the big reversal we saw, but Nvidia came out that the markets had been weakening. We've been seeing increasing um concerns about the AI space creeping into the the media, mainstream media headlines, and everybody was really hoping that Nvidia could do its usual job of announcing just complete blockbuster um earnings results and and great forecast and kind of jumpst start this market back into rally mode. And that still could happen from here, folks. I'm not saying it won't, but but what we saw instead was the market have its knee-jerk. Yep, this is great. Stock was up 5%. When the markets open the next day, Nvidia was up like almost six. The S&P and the NASDAQ were green. But then throughout the day, gravity took over and Nvidia ended up closing down over 3%. And it was it was a moment that a lot of analysts who had been sort of you know skeptical or or I the AI trade was with skepticism had told me you want to look for the moment where Nvidia does everything the world expects it to do and yet it doesn't continue that upward spark inopium. Right. >> Right. >> I can't say for sure that that's the moment. It probably isn't but we're going to be watching it really closely. But I just to your point about how much the housing market depends upon what goes on in the financial market and how so much of that depends on the AI trade >> and how much of that depends on one company. I just wanted to connect all those dots for folks because we are potentially more vulnerable than we realize uh with everything so hyperdependent upon one entity >> 100%. And and so I agree with you just seeing that happen during the day and then also you know those of us who look deep looking at their inventories climbing you know um also Bur talking about >> that there are some real reasons to have >> their real reasons but they're real reasons that you know no real reasons have really mattered Adam because I think there's been real reasons for a long time >> but they never do in a mania as you know right >> exactly but and that's what's important about the turning point is when reasons start to matteractly Yeah, >> exactly. So that's exactly right. That's it is it looks as if the reasons were going to start to matter and you can see even when we kind of had that relief rally, it just it couldn't get there. And so I I think that that that moment was very important and like you Adam, I've I've been I've watched these markets for too long and I know how the the um just how powerful that impetus of the Santa rally is so that everybody can kind of end positive and get their bonus and and all of that. But something feels different, Adam. And it feels as if we've just had some narrative busting across the spectrum and all in the everything bubble. Every single big asset class has kind of had a little a large in its armor. And so I think we are this is a very interesting time where we could actually sort of see a reversal here like a real um I don't know a real downdraft I guess uh in the market. >> Well that that so I I talked about in the intro that contagion was the theme of this year you know that that's when everything starts to get infected with change right uh and then what happens when change arrives you get trend reversal. So trend reversal may be the big the big theme of 2026. I don't want to get too far over my skis on this, but certainly you see Mr. Housing, but but it could be even more than that. >> All right. Um let me if I can try to squeeze one more topic in here, which is um so >> this is connecting the trends of sort of the aging of of the population and home buyers. Um but also with with Peter Atwater's behavioral economics which is you know generally summed up desperate people behave desperately >> right so people are always at the individual level going to try to find solutions to the problems they face if if the problems aren't getting cleared by natural market forces or by the government or whatever right and so um I just want to put up this picture I'm sure you have seen it in the media of late Melody um but this is an addition that was um added to a single family home in uh Greenbryer, Virginia, where uh the uh inhabitants of the house, the residents of the house um wanted to make it a multifamily uh dwelling. And I don't really know how they got this passed through their local zoning boards, but apparently they did. Um but they've built what I think the neighborhood sort of considers a monstrosity. Um, and I understand how this would be functionally very useful for the family living there. Um, it's probably I think most people would say this is going to be a total eyesore for the the neighborhood and probably bring down property values as a result. Um, let me put it this way. I understand the impetus behind what they did here, right? That that's a desperate person ask, you know, responding desperately to the situation they're in. Hey, you know, my folks are old. They can't afford uh to to live alone at this point in time. I've got kids that that I'm guessing, you know, probably aren't aren't being successful in launching here. So, we got to find a way to try to affordably, you know, keep a roof over our family's heads, right? What does this tell you about the state of the market? What do you take from all this? >> I mean, it's uh I I saw a lot of things that look like that in Colony Ridge in Houston, Texas, which is a large immigrant camp. Um what so what it says to me, Adam, is desperation. It's just absolute desperation. People are desperate and they're trying any kind of solution. >> Do you expect to see more of solutions like this going forward? >> Oh, I think so. If if it hasn't already happened, we already, you know, by the time we see real trends, they've already happened, you know, and so I think I think a lot of people have gotten really creative. And I think that's the other thing we've talked about on your show before. there's a very large functioning private market that none of us really have any insight into and you know the private note market where I think they get financing from private credit to do things like this um and so I think already people have started to try and get just just as a lot of seller financing things like that that's what happened in Colony Ridge for instance um and that's where the seller gives you the financing and so I think that yeah there's I think a lot of this is already happening all over the country but is pure desperation. Um do you do you expect a a wave a growing wave of I don't know what to call it chantiism uh that might spread across communities as people um you know it's harder for them to afford the homes they have but they don't want to leave and so it's this kind of like you know I'm I'm just going to do like the bare minimum to try to stay in place that I'm in and I'm going to do things that maybe aesthetically I would never do in a normal market, but you know, I I' I've got to I've got to have more people live in this house than currently live here cuz they're either family or I need the income or whatever. And it it it it kind of starts to look like that that image I just showed there where it's the sort of Frankensteinian do-it-yourself minimum viable product, you know, solution to these this uh unaffordability crisis whether you're again buying a home or or maybe forget that you're just trying to stay in your home. >> Yeah, I I I think we will and and I think I already have and you know RVs parked next to homes. I mean, down in Florida, they're like there's a whole rental RV market where uh people are renting out RVs, their RVs to like strangers. So, my point is I I and and and they're doing things like pad splits down uh in Florida where like eight people are buying home. I mean, I think that this is already happening. And I think >> Wait, wait. You you you take a home pad and you you you subdivide it. So, you've got multiple different structures and families living on the same pad. >> Wait. Well, not structures per se, not there. In Colony Ridge, you do have that, but in Florida, it's basically eight people uh sharing this house and they all have uh a section of it as theirs. This is going to be a nightmare for mortgage companies, >> right? So, it's like what would be one home has has like a a divider. So, this is my half or quarter. >> Yeah. This is my room or my space. And yeah, it's and these are big down in Florida right now. So, I think it's just that, you know, the national media is not interested. I if if the national media would get in the car with me right now, I think I could show you all of this is already happening. Um and but they they're just not interested. And so I think people would be shocked uh if they drove across this country at what they would see. >> Well, it's super interesting. And look, I I I re realizing this conversation. I myself am one of these people who, you know, took, I guess, more drastic action than I than I maybe thought I would have a couple years ago because, as everybody watching this, I think, knows by now, you know, I moved states this year, um, moved from California to Nevada. And, um, I I guess that's both a sign of the um, you know, the boiling pot that we're all in, you know, that that even for me, it got to a point where I said, "Look, it's too painful to be in this one place. I'm going to move to another. Um, but maybe there's also sort of a silver lining on that too. And look, I I I understand those sort of desperate measures that people were taking. I don't know if I am a fan of too many of them, but I get it. Um, but there is agency in the story, which is what I'm saying, right? which is you can whether it's through multigenerational living whether it's through changing the state in which you live whether it's you know changing the type of structure that you're in or maybe right now it might be choosing to rent uh and just let time work in your favor over the next couple years so you know I I while I I I think for very valid reasons we've we've you know given people a lot of reasons to worry here um it's not all terrible and and at the individual level there are ways to reduce your vulnerability to what might go on here and maybe even ways to position yourself so that when the dust does settle the natural market forces have played out, you might be in the catbird seat to get a really good sort of forever property at a good value. >> Absolutely. I mean, and it's, you know, when I saw this path and people are always like, well, you should Well, no, I've been talking about the path that that's when I moved to Tennessee. That's when I completely changed my life and I moved my mom in with me and which was just something I couldn't even comp contemplate a year before that. Okay. And it has had massive benefits in many ways uh for me personally but also it's setting me up in a position where I can act when we start to see these things finally play out. And so I think there is good news here if you want to, you know, if you're willing to make certain sacrifices and really more than that, just re-evaluate your position on some things. You know, like you re-evaluated what what is California doing for me? [laughter] You know, you knew all the reasons why you were there, but like and and I think you've also found there it it can be great to live somewhere else. Um and so I I I just I think there is hope here. I know that I'm seen as a doomer, but in reality, what I'm, you know, I'm seeing is that at the end of this road, our younger Americans are going to be able to participate in this housing market again, and we will flush the speculation out of it, and housing will become so boring, nobody will want to talk about it. >> Yeah. which is what it was I think up until about the mid 90s, right? When when that whole sort of securization uh ecosystem that you were talking about earlier got put into place, right? >> Yeah. it started uh kind of uh the home prices started coming up as the women entered the workforce and you had more divorces and household formation and but it wasn't until you know the late 80s and and into the '9s when people really started using housing as a way to to jumpstart the economy at scale and it was more investor participation than really your regular Joe and Jane. >> Yeah. Yeah. Um, well, look, if there's if there's something that our generation could leave to to the ones that come after us, I would love it if that included, you know, a boring housing market. Um, it it's just there are certain things that shouldn't be, in my opinion, um, uh, over financialized. Um, and, uh, you know, I'm probably getting in trouble here. People are going to say, "Oh, Adam's a socialist." It's it's it's not that at all. Um, but it's sort of like I get in these fights with people on or people get into these disagreements with me on X about um I I do think at least in certain situations there should be limits on investor ownership of single family homes because it's a national asset, right? It's in the best interests of the economy for our younger generations to be able to form families, right? It's the basis of of our whole society. And when we monkey around with the system and deform it and price them out, yeah, you know, some some wealthy speculators benefit, but that's much to society's degradation. And uh so anyways, I'm I'm >> Well, no, but it's like I just I just want to say quickly, it's not private actors in our securization market. These securization markets are be driven majority by our government sponsored enterprises. >> Well, absolutely. And so and so if we just like got government out of the securization markets, we would be doing a whole bunch better. Or also we could have them lower the loan limits to actually be reflective of median income. Right now they're marketbased. And and when I say the loan limit, in case people don't understand, like there's a certain limit as to what you can get for one of these FHA or GSC loans, and they publish that every year, and it's absolutely ridiculous and completely unmed from the median income. But if we just did that one thing alone, we would change things so significantly. So I I do think there are solutions um that even would you wouldn't even have to do something like you know forbid institutional ownership but you know maybe that is a temporary measure we need to uh entertain but honestly I believe that if people just let it go from this point forward and the government stepped back just a tad we would have true market forces went out >> well I I sing it sister sing it sister and let's include in that too you know the Federal Reserve um >> oh you know, maybe getting out of the game of setting interest rates and and letting you know, the market actually do that. But, you know, a huge part of this problem in addition to the government involvement in the lending markets um has been, you know, ZERP, right, as a policy and plus buying trillions in mortgage back securities, right? >> A real toxic brew. Yes. >> All right. Well, look, as we wrap this up, Melody, um thank you. It is always uh just a fascinating um eye-opening experience to talk with you about the housing market. Thank you. Um, two last questions. One, is there anything else that's burning brightly on your radar that I just haven't thought to ask you about yet? >> Um, no, I don't think so. I think we've covered a lot. >> Okay. Oh, thank you. You've given us well over an hour here. So, I very much appreciate you sharing your time here. All right. And then secondly, and most importantly, um, for folks that have enjoyed this discussion and would like to follow you and your work in between now and the next time you come on this channel, where should they go? >> Sure. You can find me on X Twitter at M3_Melody on uh Substack at M3 Melody Substack. And I encourage folks to even just sign up for the free version because I put a lot of information in there. And then M3 Melody YouTube as well. >> All right. Fantastic. And as usual, Melody, when I edit this, I will put up your handles to all those on the screen so folks know exactly where to go. Folks, the handles will be in the description below this video so you can get there with one click, too. All right. Well, look, folks, please join me in thanking Melody for giving us so much of her time and expertise today. Uh, please show that by hitting the like button and then clicking the subscribe button below as well as that little bell icon right next to it. Um, I'll make this brief, but you know, housing for many people is the most important financial decision that they're going to make in their lifetime. Um, even if it isn't, it's probably still quite a large um factor in your overall net worth. if you have questions that you're wrestling with about the housing market. Um, you know, do I maybe at least as Melody often mentions, you know, hey, if you own a home right now and you think you might want to sell it or or move at some point in time, list your house. Just see what you can get for it right now in this market. >> Um, I I know Melody, I'm putting words in your mouth here, but I think I've talked to you long enough about this. You think time works in their favor for the home buyers here. So, you know, don't feel a lot of pressure to buy right now, but there are a lot of things you can do to try to find um good deals out there in the market. Um and uh you know, if you're a seller, time may be working against you here. So, again, knowing what you can list your house for now might be a good factor and helping you determine whether to pull the trigger or not. But anyways, long story short, if you want help thinking through all of those things and how um the the financial um implications may affect the rest of your personal wealth, uh if you don't have a good financial adviser to advise you through all that, feel free to talk to the ones that Thoughtful Money endorses. These are the firms you see with me on this channel week in and week out. So to schedule a free discussion with those firms, just fill out the very short form at thoughtfulmoney.com. Firms will be in touch with you right away. Uh these are totally free discussions. There's no um commitments to work with these folks or anything like that. It's just a service they offer to help as many people as possible. All right, with that said, Melody, I can't thank you enough. Uh happy Thanksgiving this week. I hope you have a great time with your mom and with your family there. Um I will let you have the last word. Any parting bits of advice for this audience? Yeah, I I would just say it's um it's a really crazy time out there and um you know, it can be very uh easy to get um swept up in it, but I think we just have to constantly sort of re-evaluate what's important and and I hope that over the Thanksgiving holiday that folks realize that a lot of those algorithms out there are trying to divide us on purpose. And so maybe focus on reconciliation um this holiday because uh you're going to need your family and um yes you guys may have differences but understand that those differences have been exacerbated by those algorithms and that you probably have a lot more in common than you think. You know, I I literally right before we hopped on here, I was listening to an interview with Professor Scott Gway, um, who has a lot of data about the pernitious impacts that that digital media has been having on society in general, particularly younger people. But what you just said completely, uh, agrees with everything that he was saying here. And so maybe maybe our parting bits of advice for folks here is um, maybe just put the phones away for the day of Thanksgiving. try try to try to while you're gorging on good food um have a fast in terms of digital content and just focus on strengthening those times with your family because as you said as we go through you know tricky times uh social resilience uh you having communities that we can depend on particularly our family is about the most valuable asset you can have in those times >> absolutely here here >> all right well thanks so much Melody always great to see you thanks so much >> thank you thank you so much >> all right and everybody else Happy Thanksgiving and thanks so much for watching.