#369 Melody Wright: 35-50% Housing Correction Needed, First Wave 10-12% Coming

About this episode

Melody Wright discusses the current housing market and the need for a significant price correction.

Melody Wright, author of M3 Melody Substack, returns to the show for an in-person episode to discuss the frozen spring selling season and reveals disturbing signs of distress bubbling beneath the surface, including mortgage delinquencies rising at the exact time of year they should be falling. She exposes the "rage delisting" phenomenon where stubborn sellers refuse price cuts despite a massive inventory buildup, explains why the housing shortage narrative is a myth perpetuated by builders seeking a bailout, and warns that prime mortgages are now showing weakness for the first time. Melody argues that a 35-50% price correction is needed for median household income to afford median home prices, with the first wave of 10-12% likely over the next couple years. She reveals a massive shadow inventory wave from boomers that could add 20% more homes each year for the next decade, discusses how investors are fire selling (one investor dumping 300 rentals in a single market), and predicts the back half of 2026 could be "really ugly" as forbearance programs expire. Her advice: sellers should cut prices quickly to avoid cutting further, while buyers should stay patient because "the supply…

People in this episode

Host: Julia La Roche

Guest: Melody Wright

Topics covered

• housing market
• price correction
• mortgage delinquencies
• real estate trends
• investor behavior

Keywords

• housing correction
• mortgage delinquencies
• rage delisting
• shadow inventory
• real estate

Mentioned in this episode

Organizations: M3 Melody Substack, YouTube, Substack

More episodes of The Julia La Roche Show

• #376 Chris Whalen: The Markets Know There's A Problem, Trump Admin Doesn't, Rationing Ahead · June 6, 2026 · 30 min
• #375 Howell: Liquidity Slowing, Speculation Phase Ending, Why A Fed Hike Might Be Coming · June 2, 2026 · 44 min
• #374 Chris Whalen: Fed Policy Losing Efficacy, Rate Hike Coming Anyway, Private Credit Defaults at 6% · May 30, 2026 · 37 min
• #373 Chris Whalen: Why We Could See Double-Digit Inflation, Rationing, & Fed Hikes · May 23, 2026 · 34 min
• #372 Ted Oakley: Why Energy Could Surge Like Gold Did Last Year, and Most Investors Don't Own Enough · May 21, 2026 · 28 min
• #371 George Noble: Fed's Hands Tied, Bond Vigilantes Waking Up, Buy the Dip Dead, Margin of Safety Thin · May 19, 2026 · 46 min