The North Texas housing market recession continues to baffle industry participants. With mortgage rates inching closer to seven percent again and home prices still suffering from a massive bout of inflation, it’s really not too hard to understand. A series of policy errors continues to weigh on the housing market. The good news is that the market is still clearing for the most part. The bad news is there’s no easy way out of the hole. It could take years for the housing market to recover while affordability continues to remain elusive.

Self-Inflicted Wounds

For someone who proclaims to be a real estate mogul, Trump 2.0 has been an absolute train wreck for the U.S. housing market. While Donald and his family have been lining their pockets as they pump the stock market, the U.S. economy continues to suffer. Wage gains for workers have fallen below the rate of inflation. Employment growth under Trump 2.0 has been virtually non-existent as more workers drop out of the labor force.

The Golden Age of Grift is looking more like misery for many working Americans as they fall further behind. If you’re wondering why there’s been a resurgence in populism and socialist ideals, it’s not really a secret. Donald J. Trump has proven beyond a shadow of a doubt he doesn’t give a damn about working Americans who do the heavy lifting in the U.S. economy.

Trump’s corporate-friendly pro-monopoly policies have taken American consumers for a ride. Turns out all of those campaign promises were just a joke. After American consumers paid the price for Trump’s ridiculous tariffs, major U.S. corporations have been collecting $billions in refunds for those same tariffs after they were ruled to be illegal. American consumers got a giant middle finger for their troubles. Go figure!

Americans continue to pay at the pump for Trump’s insane war with Iran. Fuel prices are still more than 30 percent higher than where we started with the year, and the Strait of Hormuz has now become a comical charade. Meanwhile the U.S. strategic petroleum reserve has hit record lows as Trump tries to keep the endless lies and misdirection from upending the GOP’s chances in the November midterms.

The U.S. national debt has spiraled to $40 trillion under Trump as the lies about cutting government waste reveal that Trump is blowing more massive fiscal deficits. Apparently there are no fiscal conservatives in foxholes.

The Affordability Crunch Continues

All of these related policy errors from the Trump administration have taken a toll on the housing market. Trump may think that “affordability” is a joke, but that’s only because he’s never had to work for anything in his life. Ask most billionaires, and they will probably tell you that inflation is not really a problem. That’s because they benefit from inflation and the destruction of your standard of living.

Here in the real world, the recession for housing is pretty clear to see. On a county-wide level, home sales transactions are back to 2012 levels for Dallas County. Tarrant County is back to 2013 levels. Denton County is sitting at 2017 levels, while Collin County is back to 2020 levels.

With mortgage payments still taking up a huge chuck of buyer’s paychecks, the affordability puzzle has been tough to solve. Areas like Collin County have experienced more stable transaction volumes, but that’s only because builders ramped up development in a big way following the pandemic. Areas where development has been more muted have seen transaction volumes suffer. It’s all about affordability, and home builders have been the go-to source for affordable homes in this recession. When you make it affordable, buyers show up. When affordability is absent, transaction volumes suffer.

To put things in perspective, America’s two largest home builders just told us where that “affordability” mark is. D.R. Horton’s average sale price for the third quarter of 2026 was $365,000. Lennar’s latest reports shows an average sales price of $371,000. But here’s the wild part. Lennar was spending $47,000 in incentives to sell that $371,000 home! That tells you how severely affordability is strained. Builders are throwing out massive incentives and rate buydowns just to get buyers to qualify. If you are trying to sell an existing home in a tough market, this is what you are competing against.

Bond Yields Hold the Key

Bond yields still hold the key for the housing market. Those yields are currently flashing warning signs. That’s an indication that the Treasury secretary and the new Fed chair have a credibility problem, much like Commodus himself. Bessent has even gone so far as to help Japan intervene in their currency market to deflect attention from fiscal issues here at home. It seems the Trump administration is balancing a lot of plates in the air with no real solutions to solve a complex problem.

If you are in the market to buy or sell a home, this has important implications. While home prices have been relatively stable, transaction volumes continue to suffer from inflationary policies. The economy is looking pretty fragile in the Golden Age of Grift, and that’s not good news for prospective buyers or sellers. More volatility and uncertainty doesn’t help the real estate market.

Renting vs Buying

At least here in North Texas, the rent vs buy equation continues to favor renting. The DFW area continues to see an abundance of rental stock. That’s welcome news for anyone trying to mitigate their housing expense. We’ve seen a number of new multifamily developments in Denton County over the past five years. That’s helping to keep a lid on rents and housing expenses. While the dream of home ownership is still be challenging, there are options to mitigate that monthly housing expense.

The “buy the house and date the rate” crowed has been taken to the woodshed. That was always bad advice, and it remains so. Be careful of any real estate salesman or mortgage loan officer pitching you advice on where things will be in two years. They have no clue. You are better off watching the yield on the 10-year Treasury bond. Bond yields will be the ultimate arbiter of truth for the housing market as this recession plays out.