Why today’s housing market is stuck in a high-rate stalemate
Los Angeles real estate broker Courtney Poulos has highlighted the key factors shaping today’s housing market. According to her, high mortgage rates and pandemic-era policies—not looming resets—are the real barriers to affordability. Her observations come as buyers and sellers adjust to ongoing economic pressures.
Poulos traces current housing challenges back to COVID-19 fiscal measures. The US government’s CARES Act (March 2020) injected $2.2 trillion into the economy through stimulus checks, unemployment benefits, and business loans. Meanwhile, the Federal Reserve slashed interest rates to near zero and bought over $700 billion in assets to stabilise the stock market. These moves fuelled mortgage demand, pushing home prices up by roughly 40% between 2020 and 2022.
She notes that today’s market remains locked in a stalemate. Sellers with mortgages below 3% face losses if they sell at current prices, given mortgage rates now hover around 6-7%. Buyers, in turn, struggle to afford those same prices with higher borrowing costs. Poulos recently saw a property attract 19 offers, selling for $300,000 over asking—a sign that buyers still have strict budget limits tied to financing.
Despite broader industry talk of a '2026 housing reset,' Poulos dismisses it as unrealistic. Instead, she points to creative financing, like rate buy-downs, where developers prepay mortgage rates to lower initial costs for buyers. She also argues that tariffs, such as those under Trump adding $17,500 to new home costs, have had little impact in her Los Angeles market.
Her podcast, The Clean Close, explores these trends further, offering insights into how economic policies continue to shape real estate dynamics.
Poulos remains cautiously optimistic about the market’s direction. She sees buyers returning and sellers adjusting prices to close deals. Yet, her focus stays on practical solutions—realistic mortgage rate adjustments and flexible financing—rather than waiting for sweeping stock market changes.
