Matt Frankel

Mortgage rates continue to stay very high.

Keep in mind that a main way homeowners finance large projects is by tapping into home equity.

Lowe's had many similarities to Home Depot, as you would expect, being a duopoly.

It also lowered its full-year earnings guidance, for example.

Lowe's grew comparable sales slightly in the third quarter.

They beat expectations, which is the biggest contrast.

Home Depot fell by about 6% after earnings.

Lowe's gained 4%.

And it's really just because one beat expectations and one didn't, although it's not as big of a gap as that makes it sound.

To John's point, Lowe's CEO Marvin Ellison said that homeowners are healthy financially, but the uncertainty is making them pump the brakes on large projects.

Home Depot similarly said homeowners are in a deferral mindset when it comes to spending on projects.

There's a reason that home equity in the United States is at its highest level ever right now.

It's because people are largely on the sidelines.

We need either for home prices to come down significantly, which I don't see as particularly likely, or for mortgage rates to trend significantly lower, which is more likely but could take a while.

And that's really what we're going to need to thaw the housing market and to return Home Depot and Lowe's to any type of growth.

It's not really a question of demand.

People want to do projects.

People want to buy homes.

It's just cost prohibitive right now.

You're right.