NerdWallet's Smart Money Podcast
Understanding 2026 Housing Pressure Points and Finding Your “Enough” Number for Retirement
04 Dec 2025
Chapter 1: What are the current housing market trends heading into 2026?
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Chapter 2: How are climate risks affecting home insurance costs?
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Don't wait to buy real estate. Buy real estate and wait. It's an adage for the ages, but did it ring true this year? We've got a look at the year in housing and what it means for 2026. Welcome to NerdWallet's Smart Money Podcast, where you send us your money questions and we answer them with the help of our genius nerds. I'm Sean Piles.
And I'm Elizabeth Ayola. Now, later on this episode, we'll be asking when enough is enough and you can stop saving for retirement. Yes, you heard that right.
But first, our weekly money news roundup, where we break down the latest in the world of finance to help you be smarter with your money. Our news colleague, Anna Hilhoski, is here to talk about the year in housing. Hey, Anna.
Hey, Sean. Hey, Elizabeth. Yeah, today we're joined by mortgage writers Horace. Holden Lewis and Kate Wood to reflect on the home market this past year and look into their crystal balls for 2026.
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Chapter 3: What is Coast FI and how does it differ from traditional FIRE?
But first, I'd like to point out that it's the end of an era here at NerdWallet.
It is truly the end of an era because our very own Holden actually can probably tell us about having enough to pay for retirement because he's retiring at the end of this year.
Yeah. Man, I feel really lucky. I've made my living as a writer for 43 years. When I started writing about high school football games, when I was in college, I have never been laid off. And like no one in the journalism world has gone more than 40 years without being laid off, except for me. So, wow. What a lucky ride. Extraordinarily lucky.
Yeah, we should all be so lucky. I know I wasn't when I was about 22, but anyhow, uh, Holden, you've got more than 20 years experience writing about mortgages and homeownership, and that's pretty wild. Where did you start your career?
As far as like writing about mortgages, that was with Bankrate. And I started the mortgage beat there on September 10th, 2001. So it was quite a week to be writing about mortgages because, you know, the market basically shut down. And then, yeah, I did that for years and years and then moved over to NerdWallet in 2017 and writing about the same subject.
And then before that, I mean, I worked for the Associated Press, the Toledo Blade, worked in Dallas, Baltimore, El Paso, Lubbock, Toledo.
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Chapter 4: When can you confidently stop saving for retirement?
So I've been everywhere writing about everything. And I think the biggest story I ever wrote, like the biggest event was Baby Jessica. And I don't know how many people know about Baby Jessica. Oh, she fell in a well. Yeah, a little toddler who fell down a well in Midland, Texas in 1987.
I was there, I was on the scene writing about that, freezing my ass off because it was October in Midland in the desert and it was cold. We couldn't see much, but that was quite an experience.
That's quite the career Holden. In all that time, is there anything that you feel like is always true about the housing market?
Every generation has an affordability crisis. I just find that interesting because I see a lot of criticism of the boomers for having had it easy because houses were really cheap back when the boomers were just starting to buy houses. That's not exactly the case. I think about in 1981 when I was a college freshman, The rates on the 30-year mortgage, they exceeded 18%.
And this was happening just as the first boomers were buying houses. And for the entire 1980s, the 30-year mortgage averaged 12.7%. And in the 90s, it was 8.1%. I mean, my first house... I think we paid 8.25%. So houses did cost less back then, but that's because they had to be with those interest rates.
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Chapter 5: What strategies can help manage retirement anxiety?
The only way you could afford a house at those high interest rates was houses had to be cheap. And the houses back then, they just weren't as good as the ones now as far as energy efficiency and all that. I think about the financial crisis of 2007 through 2012. It was the result of an affordability crisis that was concealed by mortgages that were destined to go bust.
For a lot of people, the only way they could afford a home was to get a risky mortgage. something that had a super low interest rate, and they would turn it into an adjustable rate mortgage six months later with rates that were sky high. So eventually, millions of homeowners discovered that they couldn't make those mortgage payments. And that's the very definition of an affordability crisis.
Well, we certainly hear a lot about being in an affordability crisis today. So where did this one come from?
All right. So this one comes from those incredibly low mortgage rates in 2020 and 2021. You know, when I was talking about in the 80s with those high mortgage rates were forcing home prices to be low. Well, the exact mirror image of that happened in the 2020s, where you had these super low mortgage rates in 2020 and 2021.
And tons and tons of people rushed into the market and they bought houses and they were competing against each other. And that drove house prices up. And they have been stuck there at those high levels, even as mortgage rates went up, because that's just the way things are.
You know, I mean, if your house is worth $500,000, you don't want to sell it for $450,000 a year later just because mortgage rates went up. So we are kind of in this unaffordability era that it's just going to take time for us to get out of. We're going to have to build out of it.
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Chapter 6: How can Monte Carlo simulations aid in retirement planning?
And people's incomes are just going to have to continue to rise until houses are more affordable. And it really is going to take several years.
All right, so that's where we're at right now. But what do you see as maybe the next affordability crisis?
I think the next affordability crisis is going to be climate-driven. We've already seen the beginning of this with home insurance premiums just really rising a whole lot. From California to Florida, home insurance is just really, really expensive. You know, you have wildfires in places like California, Oregon, Washington, Arizona, and Colorado.
You have hailstorms and tornadoes and heavy thunderstorms from Texas to Nebraska. And then along the Gulf Coast, you have hurricanes. I think that those rising premiums are going to really make it difficult for people to afford their homes, even homes that they bought several years ago. I mean, that's already happening.
Kate, I don't want you to feel ignored here. So when you look at the housing market this year, what themes are jumping out at you?
Well, every year when we're coming around to the new year and you're in the mortgage space, you're in the homeownership space, you always get these headlines that are like, whatever year it's about to be, colon, the year the housing market normalizes. And like we got those in 2022, 2023, four or five. 2026 is not going to be the year the housing market normalizes.
And really, we need to get rid of the idea that we're going to go back to some real or imagined norm because things are really changing. So since Holden was bringing up the early 80s, I grabbed some early 80s numbers for comparison.
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Chapter 7: What investment strategies should be considered for tax efficiency?
So this is another 80s to now analogy. And I'm pulling these from the National Association of Realtors. They do an annual home buyers and sellers report. It gives a lot of information on home sales, sellers, buyers in the U.S., So in 1981, the median age of first-time homebuyers was 29. So almost 30. Get in your first place. Feels like it makes sense. In 2025, the median age hit 40.
So your median first-time homebuyer is now 40. And if that didn't break your brain, this might. Back to 1981 again, rewind. In 1981, the median age for repeat homebuyers, so it's not your first time, that median age was 36. So someone who's bought your first home at 29, you're upgrading at 36. Again, feels like a narrative that we're comfortable with, right?
In 2025, the median age for repeat buyers was 62. Wow. So a lot of people are staying in their first home a lot longer these days. Home ownership tenure has really been lengthening. You know, it varies depending on where in the country you are because property taxes are a piece of it.
Chapter 8: How can you balance saving for retirement with enjoying life today?
But people are staying put a lot longer and people are simply getting started a lot later. And this should really be changing the way that we're thinking about home buying and home ownership. Right now, if you're listening to this and you're in your 20s or even your 30s thinking like, oh my gosh, I haven't bought a home yet. I need to hurry up. You are in good company. You are not lagging behind.
You are good, okay? We are good on that goal. Another 2025 stat that really jumps out, and I need to actually give a shout out to my editor, Jeanette, because she was the one who pointed this out. So last year, among all home buyers, only 24% had children under 18 in their households. So fewer than a quarter. In 1985, 58% of buyer households had children.
So the conventional wisdom has been that spring is home buying season, right? And one reason why spring is time to list is because people have time to house shop, school's letting out. It's summer, they'll have time to move and then get settled into a new place before school starts again. But if most home buyers don't have kids, that timing is probably not that relevant to them.
And, you know, you can say, oh, you know, well, spring home buying season is about the weather warming up and that kind of thing. But again, back to climate change, weather patterns are very off track all over the country. So that argument might not hold up either.
All right. And now for the $415,200 question. That's the most recent median home price from the National Association of Realtors, by the way. What are we thinking about the housing market for next year? Holden, let me first start with you.
I'm really, really crossing my fingers that mortgage rates hang out around 6% all year in 2026. Because if that happens, we will see more homeowners just take the plunge, list their homes for sale, wave bye-bye to their 3.5% mortgage rates and say, well, okay, my next house at 6%, okay, I can handle that. With luck, a lot of people will put their houses on the market.
So we'll have a lot of houses on the market that will help prices remain flat as sellers compete on price. And it'll help us slowly emerge from this affordability crisis. And I am really interested in what you think, Kate.
So I would definitely agree with what you said about rates and inventory and also what you said earlier about the coming affordability crisis. It's something that I've been watching. We have this idea that home affordability is something that's essentially solved once you've bought a home, especially if you have a 30-year fixed rate mortgage, which is the standard in the U.S.
This is the vast majority of home loans. You've essentially stabilized your housing costs. And that is true in terms of your principal, how much you borrowed, and your interest rate, right? But we can't forget about the TI half of our PITI, right? So principal, interest, taxes, and insurance. Taxes and insurance are absolutely walloping homeowners in many parts of the country.
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