Natural Resource Stocks hosts Andy Millette and Steve Yang sit down with housing strategist and M3 Melody Substack author Melody Wright to map out a slow motion housing crisis that she argues is already underway. Drawing on inside experience from the 2008 mortgage meltdown and current loan level data, she explains why foreclosures are now climbing off historic COVID lows and why the next wave will hit so-called “prime” borrowers hardest.
In this controversial conversation, Melody breaks down the quiet tricks that kept the last few years looking healthy on paper: unrecorded forbearance liens, payment deferrals stuffed at the back of loans, and non-bank servicers chasing thin margins with borrowed money. She walks through how builder rate buydowns and aggressive incentives left many recent buyers underwater within months, why FHA has morphed into a new government-backed subprime channel, and how inflated credit scores are hiding real stress across the system.
The discussion digs into the repo market and collateral plumbing, showing how mortgage-backed securities and short-term Treasuries get pledged and re-pledged to fund leveraged bets while liquidity quietly dries up. Melody explains why she expects non-banks and some regionals to come under serious pressure, how big banks could again scoop up assets at pennies, and why she believes foreclosures and forced selling will steadily build into a widely recognized housing crisis by Q2 2026.
Finally, Melody looks beyond the headlines at demographics and household formation. She details how aging boomers who control a huge share of the housing stock, weak birth rates, and high living costs in opportunity cities all combine to cap demand and push the market back toward what local incomes can actually support. For homeowners, landlords, and would-be buyers, this is a blunt look at what a real reset could mean street by street, including the ugly reality that a single foreclosure can drag down comps for the whole block.
The opinions expressed are solely those of the guest and do not necessarily reflect those of Natural Resource Stocks. Nothing here is personal financial advice. Every viewer needs to do their own research and talk to a qualified professional before making investment decisions. Past performance is not indicative of future results, and investments in the stock market can result in the loss of principal. By engaging with this content, you acknowledge that you are fully responsible for your own decisions. Join the #Millettian community as we unpack the signals most mainstream coverage misses and try to get ahead of the next phase of this cycle.
Guest links
Melody Wright – M3 Melody Substack
Substack: https://m3melody.substack.com
X: https://x.com/m3_melody
YouTube: https://www.youtube.com/@m3_melody
Hosts and Natural Resource Stocks
Andy Millette – Natural Resource Stocks
Website: https://www.NaturalResourceStocks.net
YouTube main channel: https://www.youtube.com/@naturalresourcestocks
YouTube clips channel: https://www.youtube.com/@NaturalResoureStocksClips
X: https://x.com/theandymillette
LinkedIn: https://www.linkedin.com/in/andymillette/
Steve Yang – Natural Resource Stocks
Website: https://www.NaturalResourceStocks.net
YouTube main channel: https://www.youtube.com/@naturalresourcestocks
YouTube clips channel: https://www.youtube.com/@NaturalResoureStocksClips
X: https://x.com/TheSteveYang
LinkedIn: https://www.linkedin.com/in/thesteveyang/
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