Crash – Lowest Since 1995!

Man stressed over falling stock market graph.

(ReclaimingAmerica.net) – In a highly concerning trend, in 2024, U.S. home sales plummeted to levels not seen since 1995, hindered by sky-high mortgage rates that mocked affordability.

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With an economy squeezed by rising prices and financial hesitancy, the American dream of homeownership veered further out of reach for many.

In an era when the U.S. population has skyrocketed by over 70 million since 1995, a mere 4.06 million existing homes were sold, marking a near three-decade low.

Potential homebuyers are increasingly gripped by fear as the cost of borrowing remains just shy of prohibitive, with 30-year mortgage rates reaching a staggering 8% high in October 2023 and hovering around 7% since.

As these elevated interest rates persist, they continue to deter many would-be buyers, regardless of persistent demand for housing.

Simultaneously, the median national home price hit a record high of $407,500, a 4.7% increase in 2024, further alienating first-time purchasers from the market.

The limited inventory is a significant factor, maintaining pressure on prices.

At the close of December, 1.15 million homes were available—a figure well beneath the historical average of 2.25 million homes.

This scant inventory represents a meager 3.3-month supply, a far cry from the 4-6 months that signifies a balanced market.

Despite these challenges, there are glimmers of potential recovery, The Wall Street Journal reports.

December 2024 saw a 2.2% rise in home sales from the previous month, marking the third consecutive monthly gain.

Annually, these sales were up an encouraging 9.3% compared to December of the prior year.

However, the shadow of soaring prices looms large, with the median sales price for December climbing to $404,000, a 6% year-over-year increase.

“The situation is a direct result of economic policies that have placed undue burden on the American homebuyer,” says a concerned economist.

As efforts are made to secure a more stable market, potential strategies and interventions are being explored to ease borrowing conditions and enable a resurgence in the housing sector.

While demand for expensive properties has spurred a noticeable uptick, with sales for homes priced over $1 million climbing by 35% from the previous year, homes priced under $250,000 continue to see a decline.

This ensures a persistent gap in the market, disproportionately impacting those seeking entry-level homes and underscoring a critical lack of affordable housing options.

First-time buyers made up 31% of transactions in December, yet their annual participation rate was a mere 24%, a stark downturn from the historical average of 40%.

The National Association of Realtors (NAR) reports that all four U.S. regions analyzed showed increases in sales, with prices following an upward trend.

This complex interplay of high prices and minimal availability demands cautious optimism coupled with effective governmental policies.

Now more than ever, reinvigorating the housing sector depends on addressing the hurdles placed by rampant interest rates and sky-high prices.

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