 Could home prices in the U.S. go negative for 2022? Here we are in the last week of the year and I'm going to show you exactly what the data is showing us right now, what that looks like. We're going to dive into home prices, we're going to dive into what picture inventory is painting for us right now and what that means for you. Before I get started on that, I would just want to say I hope you had an incredible Christmas weekend with your family some much needed time off with everybody that you love. We had an incredible time here, we had family Christmas here at our house and we had both our parents over, we had Carlin's uncle, her cousin and we just had an incredible time but it was literally like Thanksgiving. We had Cajun Turkey, Honey Bake Tam and let me tell you something, that Cajun Turkey that was the best turkey that I have ever had. I'm going to figure out what the brand is and I'm going to tell you guys on the next video but it was absolutely amazing. We had an incredible time, actually we've got some leftovers for lunch, it's kind of all I'm thinking about right now but it was the best Christmas ever. Whitley of course my daughter is three years old now, she's growing like a weed and I hope you guys had an incredible Christmas. So as we dive in make sure you're subscribed and let's get started. So first off let's start here with the Red Fin data here and if we go to medium sales price we see this black line at the top that is our 2022 line right there and you can see right here back in June we peaked and prices started to come down from that peak all the way to where we are now and if you see where we are compared to 2021 which is the orange line right now as we speak here we are literally 1% ahead of where we were this time last year. So we're up 1% year over year right this second which is quite amazing. You can see what the gap was back here earlier in the year we stayed at a steady 15% over last year hit 16 a couple of times and then it just started to come down as interest rates started to come up. Now what's causing this well we all know that this is from interest rates and everything else going on in the economy slowing down demand for housing which has done an incredible job. This is all due to inflation of course and 30 year fixed rates do follow inflation which follows the 10-year treasury and all that is pretty closely correlated if you look at it over a 30-40 year time frame. So with that we've had a boost in inventory but if we look at months of inventory months of supply of inventory and we look right here this blue line here is 2019 and of course inventory has been lower than 2019 you know since the pandemic and everything that's what the orange red and black lines indicate the three years after 2019 but if we look at this year we are literally exactly where we were at this point in the year back in 2019. So it seems that since 2019 was somewhat of a normal year before the pandemic and everything else happened that we're just basically getting back to normal here which I find very interesting. Now let's look at median days on the market okay right here this blue line at the top is 2019 and here in the black we are at 2022 we're still well below our 2019 number in terms of days on the market. Now this only accounts for houses that have actually closed not counting for the ones that are sitting on the market or overpriced compared to the current market but these are the properties that have actually sold and so we do see here that houses are selling not as fast as they were back in 2020 and 21 but they are selling much much faster than 2019 so let's keep all this in perspective as we move forward here and if we move over to active listings and we see the black line again as our 2022 look at where we are compared to 2019 we don't have near the inventory that we had back in 2019 right and we don't even have as much inventory as we had in 2020 we do have more inventory than last year of course which will look at the realtor.com data here in just a second but this is a really good place to go to look at real data here according to redfin that's at redfin.com backslash news backslash data dash center and you can just play around with these different graphs and kind of get a good idea and you can even go right here and look at the different counties and metro areas as well as region names and you can really zero in on your specific market or any market that you might be looking to invest in now if we go to realtor.com and you go to realtor.com backslash research backslash data you can actually go right here and click this button our residential view U.S. data it actually brings up this spreadsheet here which gives you a week by week play week by week week by week which is very interesting and it shows you the median list price year over year active listing counts year over year days on the market median days on the market new listing counts so how many new listings come on the market this week versus the same week year prior so if we start here with the median price right listing price we're in single digits it was 9.5% last week 8.7 this week we have about 50 months 50 months here of double digit growth as far as year over year a listing price growth and these are the first two weeks here in over 50 months where we see single digit year over year listing price growth and when you look at the listing active listing count we're at 58% over last year and if you scroll down you can see that it's we were in the negatives back there in 2020 and it takes you going all the way back let's see if we can even get to positive numbers back in 19 before we had positive month over month numbers a year over year numbers same week year prior and we're at 58% which is the highest that we've had you know going back several several several years now what's interesting is that the new listing count is negative 16 so we've had 16% less listings last week than we had a year prior the same week year prior so 16% less listings but yeah there's 58% more active listings on the market so what this is saying is that even though we have far fewer listings coming on the market 16% last year over year we have still have massive growth in the actual active listings for sale but i want to get into that in just a second because there's something to be said here about this this is number one very seasonal but also you have to look at this compared to pre-pandemic first i want to show you this graph right here in terms of recessions right and so this is your housing prices this white line and this is from mbs highway but these dark lines represent recessions right there's nine of them on this chart and if you see during each recession except for 2008 of course every single recession prices went up during and after the recessions right right after these recessionary periods real estate prices went up during and after those periods except for the one in 2008 which that recession was actually caused by housing and so this is very interesting to really put this into perspective you know with the media talking about we're heading into a recession in 2023 okay this is not going to be bad for housing necessarily it could be bad for other sectors in the economy but housing is going to be just fine now if we look at inventory yes inventory is way up from last year this goes back to november 2021 right and it and it bottoms out you know um you know mid to late 2022 it starts to come up and then here we are and yet i actually see that actually peaked out in august or so and it's actually down from august right the second now you see this curve here this little wave like um you know look okay this is seasonal this is a normal cycle if you see this is the active listings that are for sale and you can see that every you know time this year we have more active listings than we do uh mid-year and this is this is the same every single year and you can see this is where we are right the second so it's no different than a normal year we're going to have an increase of inventory and then it's going to start decelerating right and and honestly i believe it's going to look like these the rest of these years that inventory is going to continue to go down you see how this plummets every year you know how inventory plummets every single year i think this year is going to be no different we're going to see inventory really decrease as we move forward here and that's going to put some some pressure on housing as far as prices stabilizing in my opinion this is very interesting this kind of shit goes back to 2007 there at the top when we had uh when we had the peak inventory houses per sale and look at where we are now we were at four million back in 2007 and now we're at two point you know 1.2 and that's that's including pending deals including pending deals the 1.2 million um and so you know the population of our country has increased by 30 million people since 2007 but yeah we have you know a third of houses for sale how do you think that's going to add up over the next couple years especially with so many people coming into their prime buying years okay and this is basically the active listings you know you can see the the curve there 2017 1819 and right now we're at 754 thousand active listings if you take the pending deals off the 1.2 we're actually 754 active listings in a country with 330 you know million 350 million people all right but look at where we are from pre-pandemic where you know um and this is total active minus pending deals we had about 1.5 back in uh 2016 back in 2019 we were in the 1.2 range um so we were in a 2.1.2 range in 2019 actually higher than that a couple times during 2019 1.2 million and now we're at 754 uh thousand uh we are you know we're we're about half of the listings that we actually need to keep up with what's happening um you know as far as people needing houses and the overall demand itself and so that's part of the problem here is that the supply and demand situation is so out of whack because of where our population is today the people that are coming into their prime buying age 33 years old is incredibly high and that's going to stay incredibly high for years and years to come but we have nearly half of the the houses for sale that we had and even even the inventory that we had pre-pandemic was not enough to keep up with demand and now we have builders um you know retracting from building more houses right this second because of what's going on with interest rates and and the uh the slowdown and the temporary um you know softening of of demand for housing so this is all very interesting i'm going to continue to keep you informed but here's what you need to be thinking about if you're a buyer if you're a seller if you're a real estate agent you need to be really thinking about this two to one buy down this two to one buy down is amazing because rates are 6.3 percent right this second and on a typical mortgage you're saving $200 from just a month or two ago when rates were at 7.3 so that's really good news and that's added about 10 buying power um for our buyers with that 1 decrease in mortgage rates and we're going to see mortgage rates continue to soften as inflation continues to trickle downward with the pressure that the feds are putting on the feds rate to combat inflation but you really need to be thinking about this two to one buy down because what happens is magical if you're a buyer you can get into a house for two percent less on the first year one percent less on the second year which means you're paying 4.3 percent right now if you get a house right this second and you get a two to one buy down you're getting into that house for around 4.3 percent or whatever the rates end up being two percent less for the first year and then they're going to go up one percent and then go to the normal percent of when whenever you bought the house for that third year but what's really cool is that you can get into your dream home right now without any competition from other buyers the sellers are most of the sellers are willing to to pitch in or even pay for this buy down for you because they're motivated the ones that actually need to or want to really sell and they really don't have many of their options of buyers right this second right now is the time I believe to go out and look and get your dream home because as I said inventory is going to decrease it's going to continue to go down that's just the trends that's just the yearly trends that we see every single year is that inventory is going to continue to come down and as inflation cools off which is also going to help mortgage rates cool off if we see a market where prices continue to soften a little bit because of lower demand and interest rates also soften and we have less inventory come springtime and the weather warms up and we have our normal springtime rush that's not going to be a great time to go out and try to look for a house because we're going to get right back to having competition especially on the really nice houses the ones that you actually want to buy so I think a really smart move for a buyer and a seller is to go out and use this two to one buy down to get into that dream home today and if prices over the two years become lower a few if we get into a place where interest rates are let's say 5.3% well you can refinance before that third year if they get lower than 5% if they're in the fight wherever if you like if they're attractive more attractive than what that third year rate's going to be you can refinance and if it's higher than what the third rate's going to be then you win you're in there cheaper than market and you got the first two years for 2% and 1% lower now this is also interesting for sellers because if you're a seller and you're thinking I'm sitting on 4.5% I'm not going to sell my house and go get into a 6.3% interest rate somewhere you can do a two to one buy down you can sell that house you can go do a two to one buy down and be in a house for 4.3% for the first year right now which really helps you get into that dream home when there's less competition from buyers right now so as you can probably tell that's where I stand on this that right now is the best time to go out there and look when no one else is really looking and you might be asking yourself Ricky what about next year what about affordability what about affordability for housing what does that look like and so that's what I'm going to get into in tomorrow's video so make sure you're subscribed let me know what you think in the comments below and we'll see you then. I want to, I want to.