New: 🧠 Market Minds Issue #110

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The Mortgage Bankers Association just dropped its December forecast, and if you're a real estate investor, broker, or builder hoping for a rebound in 2026, here’s your spoiler alert: don’t hold your breath, unless you’re underwater. The report projects GDP hovering around 1.6%, mortgage rates stuck in the 6.0%–6.5% band, and inflation still squatting rent-free in the Fed’s head.

The Fed’s “we’re probably done cutting” tone should concern you more than any single rate number. Why? Because this is now a game of controlled demolition. The Fed isn’t lowering rates to stimulate growth; it's babysitting a fragile landing gear while the economy glides just above stall speed.

There’s a new flavor of disappointment for everyone asking “will mortgage rates fall in 2026?” The MBA’s mortgage rate outlook for 2026 says no, they’ll stay between 6.0% and 6.5%. That’s not a forecast; it’s a slow bleed. Refinancing will inch up, but not enough to call it a “boom.” Translation: the Fed’s cutting cycle is likely ending before it started, and mortgage demand is entering a long, low-volatility coma. This is the MBA mortgage rate forecast 2026 30-year fixed, dull, wide awake, and uncooperative.

Yes, inventory is growing, and yes, it’s giving buyers a little more leverage. But don’t mistake that for bullishness. The MBA expects home price growth to dip into negative territory in late 2026. If that doesn’t sound like much, you’re missing the signal. Negative price growth in a nominal economy (where everything else is going up) is a red flag, especially when rates are high and unemployment is climbing toward 4.7%.

Multifamily originations? Up. Commercial activity? Rising. If you’re looking for a place where capital is actually starting to move again, it’s not in single-family resi, it’s in commercial. Not because fundamentals are surging, but because refinancing cliffs are creating forced sellers, and smart money loves a liquidity event. That’s the action right now, distressed refi arbitrage, not suburban bidding wars.

What we’re looking at isn’t a crash. It’s worse: stagnation. Home prices: flat. GDP: flat. Rates: flat. Investor returns in 2026 will go not to the optimists, but to the opportunists. The ones who understand that while the macro stays boring, the micro, block by block, lease by lease, is where fortunes get made.

This is a trench war. And you don’t win trench wars with forecasts. You win them with strategy.

The most important number in housing right now isn’t rates, prices, or even inventory. It’s this: there are 37% more sellers than buyers in the U.S. market. That’s not a wobble. That’s a structural imbalance and the widest one we’ve seen outside the pandemic hangover summer of 2025.

If you’ve been asking are there more sellers than buyers in the housing market, the answer is no longer academic. It’s mathematical. And persistent. The gap has sat north of 35% since spring, meaning this isn’t a seasonal blip, it’s a regime change.

Buyers didn’t disappear because they found better options. They disappeared because affordability finally crossed from “painful” to “nonviable.” What’s striking isn’t just that buyer counts are the second-lowest on record, but that sellers, supposedly motivated, anchored to optimism, are now retreating too. Listings are being pulled. Not because sellers got their price, but because they didn’t like the answer the market gave them.

That’s what a stalled market looks like: fewer transactions, not fewer listings. The housing market more sellers than buyers dynamic isn’t producing panic yet, it’s producing denial.

The pandemic’s great migration trade is now unwinding, slowly, unevenly, and with zero sympathy. Austin posting over 100% more sellers than buyers isn’t a typo; it’s a case study in what happens when builders overcorrect demand that was never permanent. Texas and Florida built for 2021 and woke up in 2025.

Meanwhile, the Northeast and Midwest, where permits are rationed like beachfront property, remain supply-starved. Nassau County, NY has nearly 40% fewer sellers than buyers. That’s not strength. That’s chronic underbuilding finally flexing.

This split matters more than national averages ever will. The us housing market buyers vs sellers story is no longer one story, it’s 50 micro-markets with wildly different power dynamics.

Seller’s markets are still seeing mid-single-digit price growth. Buyer’s markets? Flat, anemic, barely clearing inflation. That’s the cleanest signal in the noise. Where supply overwhelms demand, leverage doesn’t show up in headlines, it shows up in concessions, credits, and quiet repricing.

And here’s the tell most people miss: sellers aren’t cutting prices aggressively because they don’t have to. Many are locked into sub-3% mortgages and can afford to wait. That creates a slow bleed, not a crash. Liquidity dries up long before prices do.

San Francisco flipping back into a seller’s market isn’t about vibes or nostalgia. It’s about capital concentrating around AI, return-to-office gravity, and a brutal lack of new supply. When money feels confident again, it doesn’t disperse evenly, it piles back into the same ZIP codes it always has.

That’s the broader lesson here. This market isn’t broken. It’s sorting. Capital, labor, and demand are being reallocated with surgical indifference.

The era of “the market” is over. You’re now operating in markets, plural. And the spread between them has never mattered more.

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The loudest real estate conversations still orbit spreadsheets. Monthly payments. Caps. Yield. But the real demand driver has slipped past CNBC and Zillow alike: people are re-prioritizing stability, control, and psychological shelter. Not as poetry. As strategy.

A growing majority now ranks lifestyle returns above financial ones when thinking about ownership. That’s not softness. That’s signal. In an economy defined by volatility, the asset that wins isn’t just the one that appreciates, but the one that anchors.

The purchase decision has shifted from “Is this smart?” to “Is this mine?” That’s not sentimentality. It’s behavioral finance. Pride of ownership creates stickiness. Stickiness reduces churn. Reduced churn tightens supply.

This is what makes a house feel like a home: agency. The ability to decide, customize, and commit without asking permission. In uncertain cycles, control becomes currency. And ownership offers more of it than any other consumer purchase this large.

Homes are no longer passive containers between commutes. They’ve become active infrastructure for life. Work, rest, fitness, relationships, even identity formation now happen under one roof.

The implication is subtle but powerful: square footage isn’t the product. Psychological relief is. Buyers aren’t stretching for granite. They’re stretching for a reset button.

That changes how value is perceived and defended. It also explains why people tolerate higher payments longer than models predict. You don’t churn out of refuge quickly.

Freedom to modify isn’t an HGTV trope. It’s autonomy. And autonomy has measurable economic consequences.

When someone invests time, money, and taste into a space, exit friction rises. That friction stabilizes neighborhoods, compresses turnover, and quietly props up prices even when transaction volume falls.

This is the difference between a house and a home, and it matters more in slow markets than hot ones.

The next leg of the housing market won’t be driven by euphoria or panic. It will be driven by resolve. People choosing fewer moves, longer holds, and deeper roots.

Turning a house into a home isn’t a lifestyle slogan. It’s a market force. And it’s one that doesn’t show up in rate charts, but shows up everywhere else.

The smart money isn’t ignoring emotion. It’s underwriting it.

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Power shows up when patience outlasts prediction.

The MBA projects mortgage rates stuck at 6.0%–6.5%, flat GDP near 1.6%, and home price growth turning slightly negative in late 2026.

Instead of chasing a rebound, capital quietly rotates into commercial and multifamily, exploiting refinancing cliffs and forced sellers while single-family waits.

Flat isn’t failure, it’s cover for the disciplined.

The housing market isn’t crashing, it’s quietly suffocating. Rates are stuck in the 6s, GDP is flatlining, and the Fed has abandoned any illusion of rescue. We’re not bracing for impact; we’re drifting sideways, slowly bleeding out. Inventory is ticking up, but demand has checked out, not because buyers are waiting, but because they simply can’t afford to show up. Affordability has broken past painful into impossible, and sellers, locked into sub-3% mortgages, aren’t dropping prices, just disappearing. The result is gridlock: more listings, fewer deals, and a market that feels more like a game of chicken than capitalism.But beneath the stagnation, something deeper is happening. The emotional premium is back. In an economy defined by chaos, buyers are leaning into control. They’re not just buying square footage, they’re buying psychological shelter. Homes are becoming infrastructure for identity, not just investments. This isn’t about price appreciation, it’s about stability, autonomy, and agency. And that shift, from leverage to lifestyle, may be the most powerful force shaping the next phase of the market.

Have a great weekend - we’ll see you next Saturday.

Cheers 🍻

-Market Minds Team

The content of Market Minds is provided for informational purposes only and reflects personal opinions based on sources believed to be reliable. It does not constitute financial, investment, legal, or professional advice. Each reader is solely responsible for their own decisions.