For several years we have been pointing out that demographic trends are turning away from high-cost, high-maintenance housing, in favor of lower cost, more efficient, and easier-to-maintain housing. In Canada especially (and many other countries) this is happening as home prices have ballooned on a household debt bubble. This is bad timing for baby boomers who are counting currently inflated values as the bulk of their life savings and hoping to sell high in order to buy less, reduce debt, and hopefully–bank some savings for retirement. Best to get on with it sooner, than later. The pool of able and interested buyers is small and shrinking. See: A mismatch of buyers and sellers points to pain this year
The US housing market has a big problem on its hands—the types of houses people want to buy aren’t available, and the kind they don’t are. Most Americans are looking to buy starter homes, but there is currently a dearth of options available. At the upper end of the housing spectrum there is lots of availability but little interest. Overall, the balance of homes leads to a 7.4% mismatch between supply and demand, where zero would reflect perfect balance. This will likely lead to swift price rises for lower priced homes and falling prices for higher priced ones.