Housing market on brink: 7.33% mortgage rates crush buyers, six-figure earners struggle.

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Mortgage payments at 42% of income leave six-figure earning families struggling, wealth widens gap.

TLDR:

  • Mortgage rates are at 7.33% for 700-719 credit scores with 20% down.
  • Fed pivoted politically, causing bond yields to rise, impacting loan rates.
  • Bonds are being sold at discounts to attract buyers, increasing yields.
  • No one wants new bonds, so prices drop significantly to find buyers.
  • Mortgages are often bundled and sold, but investors demand higher returns.
  • Banks are adding risk premiums as delinquencies and defaults increase.
  • Housing prices are set to decline due to distressed sellers, especially AirBnBs.
  • Nearby foreclosures or fire sales will lower your home’s value.
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The housing market is teetering on the edge of a brutal collapse. Mortgage rates at 7.33% are choking buyers, while bond investors demand steeper returns to even consider touching this debt-laden market. With rising delinquencies, banks are spiking their risk premiums, adding even more pressure. As desperate sellers, including unprofitable AirBnBs, start slashing prices, the cascading effect will be felt in every neighborhood. The next foreclosure or fire sale next door won’t just be a one-off—it’ll be a harbinger of plummeting home values across the board.

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