History shows that housing prices follow sales.
For example, near the peak of the prior housing bubble, our January 2006 Elliott Wave Financial Forecast said:
Home sales are falling across the board now.
As the months rolled by in 2006, a decline in home prices followed.
Indeed, here’s an Oct. 26, 2006, Marketwatch news item:
Builders Slash Prices To Sell More Homes
Prices plunging at fastest rate in 36 years
As we know, this was near the beginning of a major housing bust which stretched out for years.
Fast forward to the current U.S. housing market.
Our February 2024 Elliott Wave Financial Forecast noted:
Existing home sales fell to $4.01 million in 2023, the lowest annual total since 1995. The 18.7% decline from 2022 to 2023 was the biggest annual decline since 2007.
Our May Elliott Wave Financial Forecast followed up with this chart and commentary:

This chart shows the quarterly year-over-year change in the median sales price for houses sold in the U.S., as compiled by the U.S. Department of Housing and Urban Development. At -12.9%, the decline is already the largest since at least the 1960s.
More than that, the recently published May Elliott Wave Theorist provided this angle on the housing market:
As posted by HUD, “An estimated 23 percent of Americans owe more on their mortgages than their homes are worth.” That’s one out of every four homes! It’s bad enough to be indebted, but it’s worse to owe more than the value of what you bought with the borrowed money.
So, similarities with the prior housing bust are already showing up.
Looking at the growing weakness in the housing market from an opportunistic point of view, big bargains could be in the works down the road.
Our Elliott Wave Financial Forecast and Elliott Wave Theorist will keep you posted on what to expect next.
Real Estate: Yes, Prices Follow Sales (Video)
Also, we’ve seen this before: 23% of Americans are “upside-down” in their mortgages
The U.S. housing market shows major signs of weakness. Learn about similarities to the big housing bust which started more than 15 years ago. This chart shows a decline which is already the largest since at least the 1960s.