The US housing market is badly broken, and it's hitting the middle class hard while the wealthy sail through untouched.

• Sellers now outnumber buyers by the widest gap since the 2008 crash, and pending home sales just hit a record low, falling far more than economists expected.
• High mortgage rates combined with still-high prices mean monthly payments are more than double what they were five years ago, pricing out most regular buyers.
• Rising government bond yields, pushed up partly by the Iran conflict, are driving mortgage rates higher, meaning a foreign war is squeezing American homebuyers.
• Builders are struggling too, facing pricier materials from tariffs, labor shortages from immigration crackdowns, and construction financing getting crowded out by AI data center spending.
• Wealthy buyers are paying all cash and driving a boom in luxury homes, so the market is now split in two: fine at the top, miserable for everyone else, with renters also getting squeezed as locked-in owners stay put.

Outlook: Without lower interest rates, home sales and new construction will likely keep falling, with the pain concentrated outside the luxury market.