Dave Meyer and J Scott, recorded in mid-October, argue that interest rates are the central housing and economic story. Scott says the Fed is losing influence over long-term yields because bond investors don't believe energy-driven inflation is temporary. Tariffs, the Iran war and hot September CPI and PPI readings point to broader inflation. Mortgage rates have climbed from 6.3% to about 7.4% in a year. Existing home sales hit a two-year low, and pending sales are down almost 5%.
Scott's base case is a quiet winter with flat nominal prices and falling real prices. His crash framework needs supply, demand and distress to converge, with labor-market weakness as the trigger. Foreclosures are up about 30% from a low base, and twice as many homes are 90 days late as in foreclosure. He calls $2 trillion deficits a house of cards, puts 20-40% odds on an extreme event, and advises diversifying into uncorrelated assets like gold, real estate, stocks and cash.