Where Have The Buyers Gone?

Where have the home buyers gone?

Home sellers outnumber home buyers by the largest margin since this metric has been tracked.

There are 37% more home sellers than buyers actively looking to buy.

Source: https://www.redfin.com/news/buyers-vs-sellers-october-2025/

Three years ago it was the exact opposite.

There were 37% more people looking to buy than those looking to sell.

There are currently 500,000 more houses for sale nationally than there are buyers looking for a home.

Source: https://www.redfin.com/news/buyers-vs-sellers-october-2025/

Pending home sales over the last year are the lowest they have been in the last 30 years. Sales are 27% below the long term average and even lower than the 2008-2010 period.

Source: https://x.com/nickgerli1/status/1993789241806213523

What is behind this reversal in residential real estate?

The obvious answer involves the increase in mortgage rates.

Mortgage rates have essentially doubled compared to three years ago.

However, a 6% 30-year mortgage rate is still an attractive rate when compared to what has been available for most of the last 50 years.

The ultra low interest rates we saw beginning in 2020  (30 year rates 3% or below), which were principally caused by the Fed's money printing to accommodate Covid relief, had the effect of massively driving up housing prices.

In a short period of time the home price to income ratio went from around 5x to 7x as home price values vastly surpassed incomes.

From 1965 to 2000 this metric was consistently right around 4x.

Source: https://www.longtermtrends.com/home-price-median-annual-income-ratio/

We have gotten to the point that 70% of U.S. households cannot afford a median-priced home.

First-time home buyers have been frozen out of the market due to affordability issues.

The median age of home buyers now stands at age 61 (half the buyers are above and below this age) 

In the early 1980's the median age was below age 35.

Only 21% of home buyers are buying a home for the first time.

It was 50% as recently as 2010.

Credit: https://x.com/AFpost/status/1988295031753716178

A big reason that there are so few buyers is that young people do not have the incomes to be viable buyers.

Interest rates are part of the equation but we have seen current rates like these many times in the past.

The bigger issue regarding affordability is the price of homes. 

All of this was exacerbated by the Biden administration allowing 10 million illegals into the country all of whom needed somewhere to live.

Demand for housing suddenly increased dramatically while the supply of housing remained relatively stable at about 1.2-1.4  million new units per year as it has been for most the last decade.

Those illegals were not necessarily buying homes but it put additional pressure on rents.

The result of that new demand meeting the existing supply is seen in this chart of rent growth for single family homes.

Credit: https://x.com/nickgerli1/status/1983677200013373585

 

The same spike in rents was seen in apartment rents.

Average rents went up over 25% in the first 18 months of the Biden administration.

Source: https://www.apartmentlist.com/research/national-rent-data

Rents and home prices also tend to move up and down together over the years as another facet of the demand and supply equation of housing.

Credit: https://x.com/nickgerli1/status/1987999925154767017

The good news is that rent growth is decelerating.

Recent months have actually seen a decline in rent prices.

Credit: https://x.com/nickgerli1/status/1987994964786082261

Some of this is related to an increased supply of apartment units coming on line but lower demand due to reduced immigration and increased deportations, a weak job market for new college grads and consumer debt pressures are all in play here.

Are home prices headed down next?

To me, that is the only real answer in order to get more buyers into the market.

Too many are simply priced out despite incomes that have increased at a faster rate than average over the last five years.

However, they have not increased nearly enough to keep up with housing prices.

Source: https://constructioncoverage.com/research/cities-with-highest-home-price-to-income-ratios

We are already seeing price reductions in some parts of the country.

However, to get affordability back in the 5x range, home prices would need to fall by around 38% from where they are now based on current interest rates.

To do that will require a lot more home listings.

For context, during the mortgage credit crisis of 2008 there were about 4 million homes listed for sale in the United States. That is double the current number.

Simply stated, home buyers will return when home prices become more affordable.

This is especially true for young, first-time buyers who have almost entirely disappeared as potential house buyers.

However, to get there will require a lot of unhappy home sellers.

Such is the unhappy outcome of the law of economics and the forces of supply and demand.

A Cataclysmic Clash of Cultures

The headlines last week were a great reminder of how harmful uncontrolled and ill-advised immigration into the United States can be.

One National Guardsman was shot to death (a 20 year old woman) and another critically wounded by an Afghan national in Washington, D.C. who clearly was not vetted properly before being allowed into the United States.

Source: https://www.cbsnews.com/news/suspect-dc-national-guard-shooting-afghan-national-what-we-know/

Democrats were quick to blame President Trump for the shootings arguing that the National Guard should not be on the streets of Washington, D.C. to begin with.

One example is former Democrat National Party chairman Debbie Wasserman Schultz.

Source: https://jonathanturley.org/2025/11/29/trump-did-it-wasserman-schultz-accuses-the-president-of-causing-the-shooting-of-national-guard-members/

Wasserman Schultz seems to ignore the fact that the Biden's administration's disastrous withdrawal from Afghanistan and lax vetting policies might have something to do with this.

Or the fact that commited Islamists do not seem to fit in with American society.

Rob O'Neill, the Navy Seal who killed Osama Bin Laden, offered this comment on X about the clash of cultures involved.

As to DWS's argument that the federal troops are not necessary in D.C and have not been effective?

Homicides are down substantially compared to last year since the National Guard has been present in D.C.

We also had headlines last week detailing the massive fraud schemes perpetrated by Somalian immigrants in Minnesota.

Billions of dollars of taxpayer money have been stolen in various welfare scams with social programs in Minnesota involving child food programs, fake daycare programs, autism support and Medicaid. 

Source: https://www.theepochtimes.com/us/massive-somali-welfare-fraud-cases-in-minnesota-heres-what-we-know-5949909?utm_medium=app&c=share_pos2&pid=iOS_app_share&utm_source=iOS_app_share

One estimate is that $6 billion in welfare fraud may be involved.

Seeing that number I could not help but recall this headline from earlier this year.

Source: https://www.startribune.com/minnesota-faces-a-projected-dollar6-billion-budget-deficit-down-the-road-heres-what-you-should-know/601232751

A lot of the stolen money went to fund extravagant lifestyles of Somalians in the United States but funds have also been remitted to relatives in Somalia and millions have also been traced to support the ISIS -affiliated terrorist group Al-Shabaab n that country.

Source: https://www.city-journal.org/article/minnesota-welfare-fraud-somalia-al-shabaab

Remittances to Somalia in 2023 from sources in the United States were a reported $1.7 billion.

To put that number in context, the entire Somalia government budget is $1 billion!

It would also not be too far-fetched to believe that some of the fraud money might have ended up in the pockets of Democrat politicians like Governor Tim Walz and Congresswoman Ilhan Omar in the form of political contributions.

The fraud by the Somalians in Minnesota is so large and pervasive that even The New York Times took notice with a major article about it over the weekend.

Source: https://www.nytimes.com/2025/11/29/us/fraud-minnesota-somali.html

“Over the last five years, law enforcement officials say, fraud took root in pockets of Minnesota’s Somali diaspora as scores of individuals made small fortunes by setting up companies that billed state agencies for millions of dollars’ worth of social services that were never provided.

Outrage has swelled among Minnesotans, and fraud has turned into a potent political issue in a competitive campaign season. Gov. Tim Walz and fellow Democrats are being asked to explain how so much money was stolen on their watch, providing Republicans, who hope to take back the governor’s office in 2026, with a powerful line of attack.

'No one was doing anything about the red flags,” he said. “It was like someone was stealing money from the cookie jar and they kept refilling it.'”

It is so bad that even the employees of the Minnesota Department of Human Services called out Tim Walz for his role in all of this.

Another quote from The New York Times story.

Dr. Samatar said that Somali refugees who came to the United States after their country’s civil war were raised in a culture in which stealing from the country’s dysfunctional and corrupt government was widespread."

In other words, the Somalians believe that it is just fine to lie, cheat and steal.

It is a function of their culture.

The same is true in the way in which the Islamists view and treat women or gays.

A fundamental flaw in the Western perspective on humanity is the belief that everyone in the world has a similar value system and that everyone else wants and respects the same things we do.

It is a dangerous notion.

We often hear that diversity is a strength and immigration is one of the things that has made the United States greater than any nation in the world.

This is undoubtedly true. However, this assumes common values, beliefs, goals and objectives. 

It also assumes that those who immigrate to the United States want to assimilate and fully commit their future and faith to their new country---not the country that they left.

If these foundational principles are not shared uniformly, diversity is a weakness, not a strength. In point of fact, diversity is a fatal flaw if the foundational principles are not aligned. 

It can lead to a cataclysmic clash of cultures.

Assimilation was not a problem with previous waves of immigration during most of U.S. history.

Immigrants wanted to assimilate and become Americans. They really did not any other choice.

For most of our history when someone left their home country they really left it.  Those immigrating to America faced an arduous ship passage.  They could communicate with friends and family only by letter once they got here.  

It was difficult to get news about what was happening in their home country. There was little chance that they would be able to go back. As recently as 25 years ago, long distance international phone calls were expensive and limited.  Facetime was the stuff of science fiction. Immigrants really did not have much choice other than to assimilate into American society. 

When someone immigrated to the United States in the past they were literally "all in".  They simply had no other choice.  They were coming to America to be Americans.  It was not just the economic opportunity but it was everything else as well.  They did not pick and choose.  They bought the whole loaf.

Are the people coming to America today really coming here to be part of the great "melting pot" that has defined us in the past?  

Are they really interested in adopting and assimilating into American culture, tradition, values and our language?  Or are they here just for the economic advantages?

Immigration without assimilation is a recipe for a cataclysmic clash of cultures.

It is the first step towards societal collapse if it is ignored.

The headlines from last week tell us how true that is.