Housing Market Warning: Don’t Count Your Home as a Retirement Plan

LISTEN and SUBSCRIBE on:

Apple Podcasts: https://podcasts.apple.com/us/podcast/watchdog-on-wall-street-with-chris-markowski/id570687608 

Spotify: https://open.spotify.com/show/2PtgPvJvqc2gkpGIkNMR5i 

WATCH and SUBSCRIBE on:

https://www.youtube.com/@WatchdogOnWallstreet/featured

Pending home sales slipped again in June—down 0.8% versus expectations of a 0.3% drop—while active listings surged by 29%. Trouble is brewing in the housing market, and the signs are hard to ignore. Despite being propped up by limited supply and financial engineering, the fundamentals are cracking. Chris sounds the alarm: housing should never be treated as a retirement plan or savings vehicle. It's a necessity, a bill—not an investment. From maintenance costs to taxes and insurance, the long-term returns of homeownership often pale in comparison to true wealth-building assets like equities. Corrections are healthy, he argues, and lower prices could actually strengthen communities and the broader economy.

Episode Transcript

Speaker 1 (00:00):
The Watchdog on Wall Street podcast explaining the news coming
out of the complex worlds of finance, economics, and politics
and the impact it will have on everyday Americans. Author,
investment banker, consumer advocate, analyst, and trader Chris Markowski.

Speaker 2 (00:16):
More ominous signs on housing June pending home sales down
point eight percent versus point three percent expectations, twenty nine
percent gain in active listings. What word comes by dumpster fire? Yeah,

(00:38):
and it's being propped up. It's being propped up. And
when I talk about this, some people will comment saying, well,
you know, Chris, you know, you know many middle class
families that your housing is their retirement plan. Housing is there?
Is there savings? And I say, not a good idea,

(01:00):
been saying that from the get go. You can't look
at your home as a savings vehicle. You stay in
it for an extended period of time, you're probably you're
probably going to sell it, more than likely going to
sell it for more than you bought it for. But

(01:20):
if again, if you take a look at any the
historical long term historical numbers, housing goes up at about
the government rate of inflation. That's just the way it is.
That's not a wonderful level of return. Housing is a
it's a necessity, it's a bill. Housing prices come down,
you're cheering on your housing prices are coming down. You're

(01:42):
cheering for the housing. Again, if you own your home,
you own your home, and you'd say you bought your
home in wherever, doesn't make it a boise Idaho for
two hundred and fifty thousand dollars a year ago. And
let's say that housing market comes down. Housing market comes down.

(02:05):
Let's say it takes your house if you wanted to
resell it a year later for two hundred thousand dollars,
Does it matter.

Speaker 1 (02:16):
That?

Speaker 2 (02:16):
Honestly, does it matter? If I buy a stock today,
I say, the companies that I owned in my portfolio,
our client's portfolios prior to Liberation Day, the market takes
a header due to that, they go down. Did I care? No?

(02:37):
I quite frankly took advantage of the situation and bought
more because we dollar cost average. Why again, we're not
selling any of those companies tomorrow. You're going to have
fluctuations when you have inflated markets. Yeah, things will correct.
There's this thing, it's called intrinsic value. What does something

(02:58):
really actually work? And that's you know, that's up for debate,
something that we look for in the companies that we buy.
You want to obviously best. You want to buy an
asset below it's intrinsic value and eventually sell it above
it's intrinsic value. That's the ultimate goal. If the value

(03:20):
of your home goes down, does to change your bill
if you have a mortgage? Again, is did the water
star comp stop coming out of your faucet or something
like that? No, no, bear it, no mind. For years
I've tried to get this across to people and to
disregard their residents or their primary residence as part of

(03:44):
their overall financial plan to consider it a bill. And
people will question me on that. I'm like, okay, why
don't you do this? Why don't you track how much
money over the course of the year you spend on
your house? Everything, everything. I don't care if it's batteries
for the smoke detectors your lawn, or the equipment you

(04:08):
have to buy to maintain your lawn, or the mulch
or whatever it may be, the bloody salt you got
to put in for your pool. It doesn't make any difference.
These are the costs to maintain your home, and over
time they add up. Hey, why don't you also throw
in there that ongoing costs known as property tax and

(04:30):
the insurance that you have to buy on your home.
And I guess guess what? You got to turn the
lights on? Right, you got to heat your home, all
of these things, all of these things, and then you
extrapolated over you know, ten, fifteen, twenty thirty years, and
then you say to yourself, do you whiz? Okay? This

(04:52):
was basically an installment plan purchase. At some point in time,
I'm going to get a rebate on And I know
I've made this before. If you were bat and you
had to hang from a tree, and you didn't have
to have a house, and you could take all all
the money that you put into your house and you
could just put it into an S and P five
hundred fund, Which do you think would make out better

(05:15):
value of a home? Or an S and P five
hundred fund over ten, fifteen, twenty thirty year period of
time and housing markets will correct, and quite frankly, it's healthy.
It's healthy. It's better for your overall community. It's going
to be better if more people can afford to get

(05:38):
into homes at a good price. It's much better for
the economy. Watchdog on Wall Street dot com