This week, thousands of REALTORS® gathered in Washington, D.C. for the National Association of REALTORS® Legislative Meetings.
For the first time in several years, I wasn’t there.
I’ll admit, it felt a little strange.
In past years, I would have spent the week attending committee meetings, hearing economic forecasts, and meeting with REALTORS® from around the country. This year, I stayed home and focused on clients, marketing projects, and a seemingly endless list of house projects.
Even so, I found myself following the meetings from afar. One presentation in particular from NAR Chief Economist Dr. Lawrence Yun stood out to me because it highlighted a contradiction I’ve been thinking about for some time:
The economy isn’t technically in a recession, but a lot of Americans feel like it is.
If the economy isn’t in a recession, why does it feel like one?
Quick Take
• The economy is growing, but many Americans don’t feel like it.
• Unemployment remains low by historical standards.
• Rising costs continue to strain household budgets.
• Housing affordability remains a major challenge for buyers.
• Mortgage rates remain elevated compared to pandemic-era lows.
• Increasing housing supply could help improve affordability over time.
The Data Says We’re Not in a Recession
When most people think of a recession, they picture widespread job losses, a shrinking economy, and businesses struggling to stay afloat.
By many traditional measures, that’s not what we’re seeing today.
The national unemployment rate remains relatively low. Total payroll jobs are near record highs. The economy continues to grow, even if that growth has slowed from the rapid pace seen after the pandemic.
In other words, many of the statistics economists use to evaluate the economy suggest that the United States is not currently experiencing a recession.
So why do so many people feel uneasy?
People Experience the Economy Through Their Budget
Most people don’t wake up in the morning and check GDP reports.
They experience the economy through their monthly budget.
They notice what groceries cost.
They notice what it costs to insure a car.
They notice utility bills, property taxes, healthcare expenses, and home maintenance costs.
And if they’re thinking about buying a home, they definitely notice mortgage rates.
While wages have increased in recent years, many households still feel like expenses have risen faster. Even when inflation slows, prices rarely return to where they were before. Families are often left adjusting to a new normal where everyday expenses remain higher than they remember.
That disconnect helps explain why economic headlines and personal experiences don’t always seem to match.
The economy may be growing, but many households still feel squeezed.
The Housing Market Is Caught in the Middle
I see this dynamic regularly in real estate.
Many homeowners are actually in a strong financial position. They have significant equity, fixed-rate mortgages, and homes that have appreciated substantially over the past decade.
At the same time, many prospective buyers are facing affordability challenges that simply didn’t exist a few years ago.
Home prices remain elevated in many markets.
Mortgage rates remain significantly higher than the ultra-low rates we experienced during the pandemic.
Insurance costs and property taxes have increased in many areas.
As a result, many buyers find themselves asking a simple question:
“Can I comfortably afford the payment?”
For some, the answer is yes.
For others, the answer is “not yet.”
That’s one reason home sales across the country have remained below pre-pandemic levels. It’s not necessarily that people don’t want to move. It’s that the math has become more difficult.
Why Housing Supply Still Matters
One of the recurring themes discussed during this year’s legislative meetings was housing supply.
Simply put, America has not built enough housing to keep pace with demand.
When there aren’t enough homes available, affordability becomes a challenge. Buyers compete for limited inventory, prices rise, and homeownership becomes more difficult for many households.
This is one reason housing affordability continues to receive bipartisan attention in Washington. While lawmakers may disagree on the details, there is growing recognition that increasing housing supply is an important part of addressing affordability challenges.
More housing options can help create a healthier and more balanced market over time.
What This Means for Buyers and Sellers
For buyers, today’s market can feel frustrating.
Mortgage rates remain higher than many people would like, and affordability remains a challenge.
At the same time, waiting for the “perfect” market can be risky. No one knows exactly where mortgage rates, home prices, or inventory levels will go next.
For sellers, the market remains active, but pricing and presentation matter more than they did during the frenzy of 2021 and 2022.
Homes that are priced appropriately and show well continue to attract interest. Homes that miss the mark often take longer to sell.
In many ways, today’s market is moving toward something that resembles normal.
Not a boom.
Not a crash.
Just a market that requires buyers and sellers to make thoughtful decisions.
My Take
One of the biggest lessons I’ve learned during my years in real estate is that data and emotions don’t always move together.
Right now, both are telling an important story.
The economy appears stronger than many headlines suggest. At the same time, housing affordability remains a very real challenge for many families.
Both things can be true.
I remain optimistic about the long-term outlook for housing and homeownership. Housing remains one of the primary ways many Americans build wealth, put down roots, and invest in their future.
But if we want more people to have that opportunity, we need to continue addressing the housing shortage and creating pathways to homeownership.
The housing market doesn’t need a boom.
It needs balance.
And while balance may not make headlines, it’s often exactly what buyers, sellers, and communities need most.
Resources
NAR Real Estate and Economic Outlook Presentation (Dr. Lawrence Yun)
Consumer Sentiment Data: University of Michigan Surveys of Consumers
Related Reading
250 Years Later: What Does the American Dream Look Like Today?
About the Author:
Jayme Ahlden is a REALTOR® Broker with Coldwell Banker Real Estate Group, serving Mahomet, Champaign, Urbana, Savoy, and surrounding Central Illinois communities. Jayme focuses on education-first guidance and helping clients navigate complex real estate decisions with clarity and confidence.
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