1980s Housing Market Conditions Return as Rates Rise and Prices Wobble

Current housing market has similarities to 1980s with high inflation, rising rates, and millennial homebuyers. This could lead to a frozen, unaffordable market like the 1980s housing recession.

Aggressive Fed rate hikes to tame inflation have caused mortgage rates to surge, reducing housing affordability and sales - reminiscent of Volcker's 1980s Fed.

Millennials are hitting prime homebuying age, which should support housing demand like the baby boomers did in the 1980s.

Indicators show the housing market is currently in a recession, though prices may stagnate rather than collapse like 2008.

If high mortgage rates persist, home prices could fall 5% by end of 2024 in a bearish scenario according to Morgan Stanley.