Things just continue to get even worse for the U.S. housing industry. New homes sales have been absolutely plummeting, homebuilder stocks have lost over a third of their value, and existing home sales just posted their biggest decline since 2014. For years, we had been witnessing a real estate boom in the United States, but now that has officially ended. It is starting to feel like 2008 all over again, and many of those that work in the industry are really starting to freak out. The Federal Reserve has been aggressively raising interest rates, and it is having the exact same effect on the housing industry that it did just before the last recession. 

It wasn’t supposed to be this way. A supposedly “booming” economy was supposed to lead to a surge in demand for housing, but instead, sales of existing homes had an absolutely terrible month in October…

Sales of previously owned U.S. homes posted their largest annual decline since 2014 in October, as the housing market continues to sputter due to higher mortgage rates that are reducing home affordability.

And this certainly was not an anomaly. Existing home sales have been down on a yearly basis for quite some time, and it doesn’t appear that things will turn around any time soon.

Just look at what is happening in California. Not too long ago prices were soaring, but now a luxury estate has just sold for more than 50 percent off.

That would have been unthinkable just a few months ago.

Meanwhile, sales of new homes have been depressingly low as well. As a result, homebuilders have been implementing extreme measures in order to get sales. The following comes from Bloomberg…

Ram Konara, a real estate broker in suburban Dallas, is raking in freebies this year: trips to Lake Tahoe and Santa Barbara in California, Cabo San Lucas in Mexico, and a dude ranch in Wyoming. The homebuyers he represents are cashing in, too. They’re winning price cuts of more than $100,000, on top of free upgrades such as media rooms, cabinets, and blinds.

This generosity flows from increasingly desperate homebuilders. Hot markets are cooling fast as interest rates rise. In the great housing slowdown of 2018, shoppers are reclaiming the upper hand, after years of soaring prices that placed most inventory out of reach for many families. “Everybody is hungry for the buyers,” Konara says.