After a burst of home buying during the pandemic drove home prices through the roof, the US housing market is in a strange place in 2026.
Mortgage rates are high, but that’s done little to help prices pull back. Amid this week’s bond market tantrum, the 30-year mortgage rate has jumped to about 6.89% on Tuesday, according to Mortgage News Daily’s survey. Many homeowners are locked into their low rates from the pandemic, while buyers are stuck navigating a pricey market that’s just barely budged from all-time high.
Apollo’s Torsten Sløk on Tuesday shared the firm’s updated US housing market outlook, and according to top economist, conditions look pretty grim. In short, things largely look stuck in place, with little on the horizon to help jumpstart the market.
“Nobody is moving,” Sløk wrote in a blog post. “The structural decline in the share of the US population changing address continues, and the share of households planning to move over the next 12 months has fallen to a record low of approximately 7%.”
Apollo Global Capital
And that’s just the beginning.
Data from Capital Economics recently showed that home sales appear to be headed for their worst year in more than a decade and that the slowdown is likely to be prolonged. Economist David Rosenberg said last month that he sees parallels to the 2008 housing crash, as many metrics of home prices show signs of “cracking.”
Apollo’s analysis found more evidence that home buyers may need to prepare for even tougher times ahead as the housing market freeze deepens.
Here are the 10 big takeaways from Sløk’s latest outlook:
High mortgage rates and high home prices have crushed interest from prospective homebuyers.75% of US households can only afford a home priced below $300,000, while the median home is priced above $400,000.The number of first-time homebuyers has fallen to its lowest level in years and the median first-time buyer’s age has risen to 40, up from 30 in 2008.People are moving much less, likely due to high prices, and the “lock-in effect” of pandemic-era low mortgage rates.Immigration has dropped, causing household formation to slow.US homes are aging quickly, the median age now being 42 years old as the construction of new homes remains low.The median size of new single family homes has decreased over the past 10 years, leading to smaller homes across the country.Home-price growth has slowed to roughly 1% but it is increasing for higher-end buyers who are not overly dependent on mortgage rates.Equity among US homeowners is roughly $35 trillion, averaging out to $400,000 for each owner-occupied property.The delinquency rate for multifamily homes has passed their 2011 peak, reaching the highest point since the Great Financial Crisis.
