U.S. Housing Sales Cycle — Drawdowns from Peak

Reading the Drawdown Chart

The Almanac defines a cycle peak as a fresh all-time high in total annual U.S. home sales (new + existing). Each subsequent year is reported as a percent decline from that running peak; when sales make a new high, the drawdown resets to zero. This framing strips away the trend and isolates the depth and duration of every U.S. housing-cycle bear market in the modern record. The chart's flat zero line is the absence of a cycle; the steep rust troughs are the moments owner equity, builder revenues, and brokerage commissions all collapsed in tandem.

Three Cycles, Three Different Causes

Three U.S. housing cycles have produced drawdowns of -40% or worse. The 1978 peak bottomed at -45% in 1982 — driven by Volcker's anti-inflation campaign, which pushed mortgage rates above 16% and made monthly payments mathematically impossible for the median household. The 2005 peak bottomed at -45% in 2011, the subprime cycle where the credit-quality unwind compounded the rate cycle. The 2021 peak is still drawing down: the current reading is -31%, the deepest level so far this cycle, with no clear catalyst for resolution while prevailing rates sit near 7%.

What This View Doesn't Show

Sales drawdowns measure transaction volume, not prices. Median existing-home prices have continued to rise even through the 2022–2024 freeze — the supply-constrained inventory has been bid up by the few transactions that clear. For the price-and-affordability view of the same cycle, see the price-to-income ratio, which tracks how many years of median household income it takes to buy the median home. For the regional dispersion across the cycle, the metro and state pages decompose the national pattern into 100 metros and 51 states.