Why did the US housing market suddenly crash this year? The answer lies in an ecosystem chain that has been choked off by high interest rates.

Immigration, housing prices, rent, and supply—these four links used to fit together quite well. In the past three years, the US’s net population increased by over 6 million, with immigration providing a solid base of demand. But in 2025, everything changed dramatically. High interest rates acted like four pairs of scissors, cutting off every node in this chain.

Developers can no longer access cheap money, causing a halt in new home supply; buyers see their monthly payments soar and are afraid to purchase, leaving existing homes stuck in hand; renters are crushed by high rents and start moving to the suburbs; and with tighter immigration policies, a key pillar of demand has collapsed. Under this fourfold pressure, a market that was once relatively healthy has now begun to show cracks.