Housing Market Now Falling Into A Deflationary Vortex | Nick Gerli
Prices are now falling in 50% of US states
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The housing market remains in an injured state, with transactions still frozen and HALF of US states now seeing falling prices month-over-month.
But...the Federal Reserve has resumed rate cuts and mortgage rates are lower than at the start of the year.
So, will we start to see some healing in the housing market as we head into 2026?
Or will things get worse from here?
Today we have the good fortune to be joined by Nick Gerli, founder of reventure Consulting and creator of the excellent reventure app.
In today’s interview, Nick walks through his latest --- and increasingly pessimistic -- outlook on the US housing market and shares a number of charts with us.
The weakening of the US housing market looks like it’s going to be a major driver of the macro action 2026.
To learn why, click here or on the video below:
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Adam’s Notes: Nick Gerli (recorded 10.8.25)
EXECUTIVE SUMMARY:
Housing Market in Disinflationary Vortex: Nick Gerli assesses the U.S. housing market as entering a deflationary phase, with national home price growth flat year-over-year, declines in nearly half of states, and rent growth at 14-year lows, signaling rising inventory and potential further drops into 2026.
Key Drivers: Affordability and Supply: Affordability crises in both for-sale and rental markets, driven by high debt-to-income ratios, slowing wage growth, and reduced immigration, are converging with surging supply from new builds, investor sales, and potential labor market weakness to pressure prices downward.
Local and Bifurcated Trends: While macro trends point to declines, the market remains
