- This is the housing market in 2023. Everything is falling apart. - The Housing Market has entered a recession. That's the consensus from realtors and home builders.

- In Some of the most desirable markets, there's only a one month or maybe two months supply of inventory. - They Claim some renters capable of paying are taking advantage of it. - They're saying we're only gonna sell mortgages if you're an existing customer or if you happen to reside in a minority neighborhood. - Well Unfortunately,, I think the housing market's a little bit worse than those people realize.

- You're gonna push out the working and middle class out of New York City because this is like the last nail in the coffin. - The Past two years represented the most unprecedented events in history. The Government first printed trillions of dollars and has now decided to retract trillions of dollars at an unparalleled rate. Interest Rates are rising at a pace that is faster than at any other time in history.

That's right,, there has literally never been another period in history like now. The Part of the economy that will soon take the biggest beating from this is the Housing Market.. This is going to go in the books as one of the most serious housing crises in history. Some People are in disbelief at the idea that the housing market will crash.

Skeptics will ask, "How Is it possible "that such a stable industry will fall apart?" Home Prices have been increasing year after year for the past decade. People Have been predicting a crash for years, but prices only kept going up. That's exactly what everyone said in 2007 before home prices crashed by 33%. People like Michael Burry and Steve Eisman from "The Big Short" saw the data and knew that housing prices were going to fall.

They were able to make hundreds of millions of dollars, but nobody else saw the data until it was too late.. - Now that we're hearing today about a 27% drop in the number of homes sold last month compared to June. - That's really a sad situation. I'd rather not meet the people.

- Why not? - It's not easy to to come in and and move a family out.. - This was Los Angeles where 37,000 homeowners gathered and this was Miami in February, where the worry was visible and shared by 12,000 more. The line went down the block and doubled back twice. - Our Situation is no different from the 2008 recession.

People Say that history repeats itself and that's exactly what's happening. Just Like in 2007,, the current data about the housing market is horrifying.. For Instance,, take a look at the US's National Association of Home Builders Housing Market Index, or the NAHB Index in short form. The NAHB Index tracks the confidence of home builders in the United States, which will help us obtain an inside look into the industry.

According To the index, home builder confidence has dropped for 12 consecutive months in a row to just 31 out of 100. The Last time we had such a large decrease was during the pandemic when shelter in place was active. There are several reasons why this is the case, but ultimately there is one main reason. Home Buyers simply can't take out mortgages at an affordable interest rate.

Even If someone wanted to get a mortgage at a higher interest rate, they would have difficulty getting a loan approved by the banks, who know that the market is doomed to fail. Because Of this reason,, there is simply no demand for homes right now. Home Builders that bought into the housing bubble are now stuck holding the bag.. Imagine You were a home builder in 2020 and you saw massive amounts of demand for homes.

The Logical decision would be to build more homes. So You start building thousands of new homes in anticipation of high demand. But By the time you start to finish those homes, demand has already disappeared. You See,, home building took off to all-time highs in the past year due to unprecedented demand.

But That's because the Federal Reserve cut interest rates to 0%, which created a huge buying frenzy. Now That the Fed is raising rates and there's no demand, many home builders are running into financial issues. Even The homes that are selling are being sold at huge discounts. Not Only that, but many homes are being sold with extremely low quality control.

Because Home builders can't finance high quality control,. it's not uncommon to see doors fail to close or for walls to start falling apart upon moving in.. - Over Time, she said: the floor of one of their rooms is slanting in, one of the bathtubs is bowed so it flexes against the wall. - Agency in Las Vegas says this race for buyers using attractive cost reductions is rare.

- We Haven't seen any incentives like that for a very long time. - In August, we introduced you to a man who moved into his new home in May. The Cosmetic issues, like some of the doors not closing smoothly or the right appliances installed, resonated with a lot of viewers.. - There's a common saying that when a crisis comes, corporations are the first to leave.

This leaves the middle and lower class left holding the bag with their life savings invested. Well, that's exactly what's happening right now. Banks Know that the housing market is collapsing and they are getting out of the market as fast as possible. The Undisputed number one player in the mortgage industry is Wells Fargo.

As You might have guessed, Wells Fargo is currently backing out of the mortgage industry. Wells Fargo Recently announced that they will be downsizing their entire mortgage division worth $1 trillion in loans. That's right,, $1 trillion in loans. Wells Fargo has now decided that it will only offer home loans to existing customers and minority communities.

The Bank will also be shutting down all purchases of loans from third-party lenders. The Last time this large of a step down occurred in the mortgage industry was in 2008. During The 2008 Recession, Bank of America and JP Morgan Chase slimmed down their mortgage businesses, causing them to lose market share that they never gained back. The Captain is the first to leave the ship when the ship is sinking.

If You see the captain jumping out of the ship, you know something's horribly wrong. All the captains are no longer on the ship. For Instance,, remember when Fannie Mae had to be bailed out in the 2008 recession? - What Fannie Mae did was that they would buy loans from lenders and other companies, repackage them, and then sell them to investors. The Lenders would get fresh capital that they could use to make more loans.

Investors would get these great mortgage backed securities and Fannie would take a fee for guaranteeing that the borrowers were gonna pay off their debts. - Fannie Mae is now panicking like there's no tomorrow. A New report from Fannie Mae states, "Results suggest that the housing market "may be more vulnerable than previously thought "to rise in mortgage rates." Fannie Mae knows far too well that the housing market is in deep trouble. The Fannie Mae National Housing Market Survey is an indicator that helps Fannie Mae make decisions about its mortgage business.

Currently, the survey shows that the market is only going to continue getting worse and worse. According To the survey,, 76% of citizens currently think that it's a bad time to buy a home. That's an astoundingly high percentage of people. If Nobody wants to buy a home,.

What do you think will happen to the housing market? It's not rocket science. If Nobody is buying houses, housing prices will fall. And It's not just me saying that. The Data supports exactly what I'm talking about.

Mortgage Applications are now down to levels not seen since 2001. That's right,, mortgage applications are at a level not seen in 22 years. So We not only have banks refusing to lend mortgages, but also people not even applying for mortgages in the first place. Even A five year old would know how terrifying that is..

The Government knows this too, but they don't want the public to realize this. According To a leaked clip from the Federal Deposit Insurance Corporation, or FDIC in short form,, the government is withholding information from the public. In The following clip that I'm about to show you, the FDIC was discussing the sentiment about the financial crisis. The FDIC has an extreme lack of faith in the current banking system and wants to keep this away from the public.

They Question whether the public needs to know, but why would we not need to know? - It Should be accessible when people need to know, but I Don't think you have much hope of reaching a public that doesn't have a professional need to know. - I Completely agree with that. I Almost think you'd scare the public if you put this out. Like, Why are they telling me this? Should I Be concerned about my bank? My Insurance company doesn't tell me what they're doing with my assets.

They Just assume they're gonna pay my claim. I Think you've gotta think of the unintended consequences of taking a public that has more full faith and confidence in the banking system than maybe people in this room do.. That We want them to have full faith and confidence in the banking system. - Banks are losing hundreds of millions of dollars from the housing market and are at risk of going bankrupt.

But The public shouldn't know this, right? If The public were to realize how fragile the banking system is, the entire economy would fall apart. Everything is dependent on the public's faith. Just Like the calm before the storm, nobody knows the storm is coming until it's too late. So We now know that nobody wants to buy houses, banks don't want to lend money, and the government doesn't trust the banking system.

But That doesn't show the whole story because we haven't even started talking about the rental market. A Lack of confidence in the rental market has led many renters to be frozen in their decisions. Nobody Knows what to do because they have to live somewhere, so people have simply stayed put. For The first time since 2009, U.S.

apartment demand has turned negative. We Typically see a huge bounce in rental demand after students graduate from college and move into apartments. But This has not happened in 2022.. Some Might say that this is because college students can't get a job in this economy, but that's just not the case.

We Know from employment data that most college students that graduated have found jobs. So The only possibility is that college students have landed jobs but still chose to live with their families due to uncertainty with the housing market.. Let's say a college student named John graduates and lands a job at McKinsey as a business analyst. Even Though he has enough income to move into an apartment,, John is unsure of whether he will be able to keep his job for a long period of time.

So instead of moving into the apartment, John decides to move in with his parents. This will allow John to save money just in case the economy collapses and he loses his job. That's a type of decision that we typically see in deep housing recessions. The Popularity of this decision right now is creating a serious demand issue in the rental market.

To Make matters even worse for landlords,, evictions are also occurring in Mass. Cities Nationwide have seen their eviction filings take off as tenants are failing to pay their rent. This is because, during the pandemic,, the government prevented landlords from evicting tenants. Laws Like the COVID-19 Tenant Relief Act made it extremely difficult, if not impossible, for landlords to evict tenants.

Now That government support for renters is dwindling, landlords are finally evicting tenants in mass. Take A look at the state of Minnesota, which has seen its eviction filings increase by 6,800% since April 2020.. That's a frightening amount that highlights how horrifying the rental market has become. Cities Like New York City Have tried to prevent mass evictions by releasing laws that allow tenants to not pay their rent.

Now Some tenants who are capable of paying rent are taking advantage of these laws. Landlords have protested against such laws but have failed to gain support. - They Claim some renters capable of paying are taking advantage of it. - But There's a lot of people who don't pay their rent, but at the same time, going out and buying a sports car.

We are going against those people. - Small Landlords are being forgotten. - The Problem with these policies is that they cannot continue forever. It's similar to middle school students procrastinating on their homework.

Eventually, they will have to face the consequences of delaying the inevitable. And The longer they delay the inevitable, the worse the outcome will be. As I Mentioned earlier, the demand for new apartment leases has turned negative for the first time in 14 years. If Nobody moves in, then the apartments will simply be empty.

Mass Vacancies would be terrifying for the rental market and the economy as a whole. So There you have it, the housing market at large is in deep trouble and it's only going to become much worse from here. If You want to see more data-based videos like this,? hit that like and subscribe button and I'll see you in the next one.