One of the biggest questions I hear right now is: “Is the housing market going to crash like 2008?”

It’s a fair question, because 2008 was not just a slowdown. It was a chain reaction: risky lending, rising delinquencies, forced selling, and a flood of supply that pushed prices down fast.

Today’s market has challenges, but the fundamentals are different in a few important ways.

1) This is not 2008 lending

In the years leading up to 2008, a lot of buyers ended up in mortgages they could not sustainably afford. When the system tightened and prices softened, many homeowners had little margin for error.

Today, underwriting standards are significantly more structured, and lenders are required to focus on ability to repay. That does not make the market “risk-free,” but it does reduce the odds of widespread loan failure at the same scale.

2) Homeowners have more equity

Equity matters because it changes what happens when life changes.

When homeowners have equity, they usually have options:

• Sell without needing to bring cash to closing

• Move without defaulting

• Avoid forced selling when conditions get tougher

More equity across the market generally means fewer distressed sales, and distressed sales are often what accelerates a true crash.

3) Inventory is still tight in most markets

Prices tend to collapse when supply overwhelms demand.

Even if you are seeing “more listings” than last year, that does not automatically mean we have a surplus. In many places, inventory is still closer to “limited” than “flooded,” which makes a major price collapse harder to sustain.

4) Demand has not disappeared

Higher mortgage rates changed behavior. Buyers are more selective, they negotiate more, and they move with clearer budgets.

But demand is still there, especially from large generational groups that are in homebuying years. They are not rushing like the frenzy years, but they are still buying, just more strategically.

So could prices correct?

Yes. Some markets may soften, especially where affordability is stretched or where inventory has risen the fastest.

But a correction is not the same as a crash.

The better question is: what is happening in your local market, in your price range, with your payment target?

If you want to walk through what’s really happening in your market and what the numbers say for your situation, reach out.

Mike DeHaut Jr.

Sources

• Federal Reserve, Household Debt Service Ratios (DSR): https://www.federalreserve.gov/releases/dsr/ Federal Reserve

• FRED (Federal Reserve Bank of St. Louis), Household Debt Service Payments as % of Disposable Income (TDSP): https://fred.stlouisfed.org/series/TDSP FRED

• FRED (Federal Reserve Bank of St. Louis), Owners’ Equity in Real Estate (level): https://fred.stlouisfed.org/series/OEHRENWBSHNO FRED

• FRED (Federal Reserve Bank of St. Louis), Owners’ Equity in Real Estate as % of Household Real Estate (HOEREPHRE): https://fred.stlouisfed.org/series/HOEREPHRE FRED

• National Association of Realtors, Existing-Home Sales and inventory data: https://www.nar.realtor/research-and-statistics/housing-statistics/existing-home-sales National Association of REALTORS®+1

• CFPB, Ability-to-Repay and Qualified Mortgage Standards (Regulation Z final rule PDF): https://files.consumerfinance.gov/f/201301_cfpb_final-rule_ability-to-repay.pdf Consumer Financial Protection Bureau

• NAR, 2025 Home Buyers and Sellers Generational Trends (PDF): https://cms.nar.realtor/sites/default/files/2025-03/2025-home-buyers-and-sellers-generational-trends-report-04-01-2025.pdf NAR

• Mortgage Bankers Association, National Delinquency Survey highlights (Q3 2025): https://www.mba.org/news-and-research/newsroom/news/2025/11/14/mortgage-delinquencies-increase-in-the-third-quarter-of-2025 MBA

• Federal Reserve History, Subprime Mortgage Crisis overview: https://www.federalreservehistory.org/essays/subprime-mortgage-crisis Federal Reserve History

• Financial Crisis Inquiry Commission, Final Report (PDF): https://fcic-static.law.stanford.edu/cdn_media/fcic-reports/fcic_final_report_full.pdf FCIC Resource Library

• Cotality (CoreLogic), negative equity snapshot (Q3 2025): https://www.cotality.com/press-releases/u-s-home-equity-dips-fall-2025 Cotality