Waiting For The Crash: What The Housing Data Actually Says Right Now

I keep running into the same conversation. Somebody tells me they are sitting it out. Ten years, maybe twenty. They have read that the boomers are going to die off, that nobody can afford anything, that the whole thing has to break eventually. So they wait.

I have been selling houses in the North Valley since March 2002. I sold through the run-up, I sold through the collapse, and I sold through the years afterward when half my clients owed more than their house was worth. I am not going to tell anybody what prices will do next. Nobody knows that, and anyone who says otherwise is selling something.

What I can do is lay out what the data says today, where it comes from, and what actually happened the last time. Then you can decide for yourself.

My position, stated plainly: I do not have data in front of me that says a crash is coming.

The market really has softened. That part is not spin.

NAR's August 2026 report, released September 10, put existing-home inventory at 1.62 million units. That is a 4.9 month supply. Lawrence Yun, NAR's chief economist, called it "its highest level in over ten years" and said "the ample supply of homes for sale on the market is giving homebuyers better opportunities to negotiate."

Homes sat a median of 31 days. That is a very different market than the one where my buyers were writing offers sight unseen and waiving everything.

So if you are waiting for leverage, some of it is already here.

But more supply has not produced falling prices nationally.

Same NAR report: the median existing-home price was $429,100, up 1.6% from a year earlier.

S&P Cotality Case-Shiller for July 2026 had the National Index up 1.9% year over year, the 20-City Composite up 2.5%, and the 10-City up 3.4%.

Here is the part most headlines skip. Rebecca Kaufman at S&P Dow Jones Indices noted in that same release that "home prices continued to decline in real terms in July 2026, marking the 14th consecutive month of real declines." Adjusted for inflation, housing has been getting cheaper for over a year.

That is the shape of what is happening. A slow grind in the buyer's favor. Not a cliff.

What it looks like here in the Valley

I am not going to quote national averages and let you assume Phoenix tracks them, because it does not.

In that July Case-Shiller release, Chicago led the twenty metros at 6.9% year over year. Seattle was negative at -1.6%. Phoenix came in at 0.05%. Flat.

ResiClub's national inventory analysis from August 6, 2026 found active inventory up 2.1% nationally year over year but still 9.1% below pre-pandemic July 2019 levels. Sixteen states plus DC have climbed back above their 2019 inventory, and Arizona is one of them, alongside Alabama, Arkansas, Colorado, Florida, Hawaii, Idaho, Nebraska, North Carolina, Oklahoma, Oregon, South Carolina, Tennessee, Texas, Utah and Washington.

So Arizona is one of the looser markets in the country right now. If you are a buyer in the North Valley, that is your news. Prices are flat, inventory is above pre-pandemic norms, and sellers are negotiating. I am watching it happen on my own transactions.

That is a correction working itself out. It is not a crash, and waiting another decade for one does not get you a better version of what is already on the table.

The boomer argument, with the actual research attached

This is the one I hear most, so it deserves the real numbers rather than a vibe.

Freddie Mac studied exactly this question. Their finding: roughly 9.2 million fewer Boomer homeowner households by 2035, dropping from about 32 million in 2022 to about 23 million. But only about 2.7 million of that happens through 2028. The annual declines run near 300,000 in 2024 and build toward roughly 1.2 million by 2035.

Freddie Mac's own words: "The silver tsunami is more like a tide, with a gradual reduction phasing in." They also expect the increase in young adult homeowner households to more than offset the decline in Boomer homeowner households.

Set that against roughly four million existing-home sales a year nationally. A few hundred thousand additional listings per year, spread across fifty states, is volume the market absorbs. It is not a flood hitting all at once, and it is not concentrated in any one zip code.

Why 2008 happened, and why that setup is not on the board today

Prices did not collapse between 2006 and 2011 because there were too many houses. They collapsed because the loans were bad and forced sales cascaded on top of each other. I watched it happen from inside.

Look at what the lending actually was. The Chicago Fed documented that subprime mortgages were "over 20% of all mortgage originations in 2006, up from 6% in 2002," and that subprime ARMs went from 27.6% of subprime loans in December 1998 to about 50% by December 2006.

Then look at the damage that produced, and what the same measures read today.

Delinquency. The Mortgage Bankers Association's National Delinquency Survey hit a record 10.06% in the first quarter of 2010. For the second quarter of 2026, MBA reported delinquency "decreased to a seasonally adjusted rate of 4.37 percent of all loans outstanding."

Negative equity. CoreLogic counted 11.1 million properties underwater in the fourth quarter of 2010. That was 23.1% of every mortgaged home in America. Nearly one in four.

Today, ICE's August 2026 Mortgage Monitor put mortgage holder equity at a record $18 trillion, with $11.7 trillion of that tappable across 47.5 million mortgage holders, averaging roughly $212,000 each. Underwater borrowers: about 813,000.

Eight hundred thirteen thousand, against eleven point one million.

That is the whole argument in two numbers. A price collapse needs sellers who cannot sell at a profit and cannot refinance out, so they have to hand the keys back, and each one of those sales drags the next comp down. That machine needs fuel. Right now most American homeowners are sitting on the largest equity cushion ever recorded.

Where I will not tell you everything is fine

Two things in the current data cut the other way, and you should have them.

First, that 813,000 underwater number is up 44% year over year per ICE, concentrated in FHA and VA borrowers who bought between 2022 and 2025, especially in Texas and Florida. Recent buyers in the boomtowns are the thin spot. If you bought in the last three years with a low down payment in a market that ran hot, you have less room than the national averages suggest.

Second, the New York Fed reported for the second quarter of 2026 that 1.52% of mortgage debt flowed into serious delinquency, up from 1.29% a year earlier. Joelle Scally at the NY Fed said delinquency rates "have held steady over the past two years," but added that "new delinquencies for auto loans and credit cards remain at elevated levels, a trend we'll continue to monitor." Total household debt sat at $18.8 trillion, with mortgage balances down $74 billion on the quarter.

So consumer credit stress is moving, off a very low base, and mostly outside of mortgages. That is worth watching. It is not 2006.

The number I actually watch

Foreclosure waves are an employment event before they are a housing event. People do not walk away from a house they can afford. They walk away from a house they can no longer pay for.

NAR's August release noted 643,000 jobs added year to date and wage growth of 3.1%. That is the dial I watch, more than inventory counts or headline price indexes. If that turns hard, the conversation changes. Until it does, the mechanism that produced the last crash is missing its first ingredient.

What I would actually tell you

I am not telling you to buy. I sell real estate and I am not going to pretend that does not color how people hear me, so here is my position without the pitch.

What the data says today: supply is the best it has been in a decade, prices are falling in real terms and are flat to slightly down in some metros including mine, owners are carrying historically large equity cushions, lending standards look nothing like 2006, and the boomer transition is a decade-long tide rather than a wave.

If you wait ten or twenty years for a drastic fall, you are making a bet that today's data does not support, and you pay rent the entire time either way. Meanwhile the negotiating leverage people say they are waiting for is partly sitting on the table right now, in this market, in this valley.

Run your own numbers. Look at your own job security and how long you plan to stay. If the payment works and you are not going anywhere for seven years, the national forecast matters a lot less than people think. If the payment does not work, no amount of market timing fixes that.

And if you want to see what is actually happening on your street rather than in a national index, that part I can just show you.

See what is happening on your street

See what is available in your area right now

Find out what your home is worth today

Sources

• National Association of REALTORS, Existing-Home Sales, August 2026, released September 10, 2026: nar.realtor
• S&P Cotality Case-Shiller Home Price Indices, July 2026: PR Newswire release
• ResiClub, national active inventory analysis, August 6, 2026: resiclubanalytics.com
• Freddie Mac, Aging Boomers and the Impact on the Housing Market Over the Next Decade: freddiemac.com
• Federal Reserve Bank of Chicago, Comparing the Prime and Subprime Mortgage Markets, August 2007: chicagofed.org
• Mortgage Bankers Association, National Delinquency Survey: mba.org, with the 2010 record via MBA Chart of the Week
• CoreLogic negative equity, Q4 2010, via Calculated Risk
• ICE Mortgage Monitor, August 2026: theice.com
• Federal Reserve Bank of New York, Household Debt and Credit Report, Q2 2026: newyorkfed.org

Jon Hegreness, REALTOR / Associate Broker, Howe Realty
(623) 826-0888 · JonHegreness@gmail.com · License BR540940000
9059 W Lake Pleasant Pkwy, B-200, Peoria, AZ 85382
PreviewArizonaHomes.com

This is market commentary, not a prediction and not financial advice. Figures are as reported by the sources listed above on the dates shown.