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Meredith<\/a> Whitney, the one-time \u201cOracle<\/a> of Wall Street\u201d who predicted the Great Financial Crisis, doesn\u2019t mince her words. Young, single men, living at home and playing video games are behind a \u201ccrisis of the American male,\u201d she explained in an interview with Fortune<\/em>.<\/p>\n Her theory about dateless, spiraling young men ends with home prices declining for years, or even decades. Whitney sees home prices falling 30%, but it\u2019s \u201cnot the end of the world,\u201d in her mind because of how much prices went up during the pandemic-fueled housing boom. \u201cThere\u2019s so much equity stored up in American homes, there\u2019s no collateral damage from that\u2014people then, on paper, are worth less than they thought they were,\u201d Whitney said. \u201cIt sounds dramatic, but it\u2019s really not that dramatic just because you\u2019ve had so much massive inflation from the zero interest rate policy.\u201d\u00a0<\/p>\n As of last year, almost 40% of American homeowners were mortgage-free<\/a>, meaning they owned their home outright. Although they\u2019d probably be upset to see their net worth fall that much. On the other hand, those who missed the mark and didn\u2019t buy a home before the run-up in prices during the pandemic, might be happy. But let\u2019s go back to the premise: young men (who are actually only part of the equation, and something she\u2019s discussed before<\/a>).\u00a0<\/p>\n A lot of young men are single, a study<\/a> from the Pew Research Center found last year. More than 60% of men under 30 described themselves as unattached in a survey conducted by the Pew Research Center; Whitney referred to this analysis in her thinking. The aforementioned study also found the share of single men in the country looking to date or be in a relationship has declined since 2019, which Whitney alluded to, and emphasized that a portion of young, single men \u201chaven\u2019t had sex in the past year and don\u2019t seem to be bothered by it.\u201d More men are living at home with their parents, and for longer too. A 2016 report<\/a> from the Pew Research Center found young men were more likely to live at home with mom and dad than a partner.\u00a0<\/p>\n So where does this all stem from? Mid-2000s video games, in Whitney\u2019s mind. \u201cYou have an ability to feel like you\u2019re gaming with a group of friends or community, but you\u2019re really just at home alone,\u201d she said. \u201cAnd so the socialization of the young American male really started to break down significantly around that time.\u201d According to Whitney, as gaming went up, so did malaise, noting a \u201cdespondency and rampant loneliness amongst young men,\u201d in a recent note her advisory group produced. The gaming explosion was driven by technological improvements and the growing popularity of gaming on an iPhone; and it coincided with a poor job market. Combined, these forces have created a cohort of young men who don\u2019t know how to socialize, in her view. \u201cGaming and social isolation are somewhat of a vicious cycle in which the lack of real social contact creates a sense of social unease, making real social contact much more uncomfortable,\u201d the note states. <\/p>\n Last year, an analysis<\/a> found that 65% of Americans played video games, and that equated to more than 200 million weekly players, and a 2015 report<\/a> from the Pew Research Center found that 77% young men play video games\u2014more than any other demographic.\u00a0She\u2019s said something similar before<\/a>, only it was about sports betting.<\/p>\n \u201cUnless you\u2019re creating a household, there\u2019s no reason to buy a house,\u201d Whitney said, touching on household formations and birth rates. Before the pandemic, household growth over the previous decade was the lowest ever recorded, per<\/a> Pew. But another account<\/a> shows a surge in household growth from 2019 and 2021.\u00a0<\/p>\n Still, household formation and demand for housing is only one part of the equation. The other has to do with a \u201csilver tsunami,\u201d a metaphor for an aging population, really baby boomers in the housing world. There are varying estimates and predictions regarding the \u201csilver tsunami,\u201d but it all essentially boils down to more supply. Whitney, toward the end of last year, said<\/a> 51% of people over the age of 50 are set to downsize to smaller homes, citing an AARP report at a conference. That would bring more than 30 million housing units to the market. Separately, a recent Freddie Mac<\/a> analysis<\/a> revealed nine million homes were set to come onto the market in the next decade as baby boomers age, but suggested it wasn\u2019t going to really disrupt the housing world.\u00a0<\/p>\n Either way, she sees more supply and not enough demand in the coming years, which\u2019ll culminate in plummeting home prices\u2014essentially our current situation inverted. Presently, we don\u2019t have enough housing to meet demand (one estimate<\/a> shows we\u2019re actually missing anywhere between roughly two million and seven million homes), and home prices keep escalating because of it. Whitney doesn\u2019t think we have a housing shortage, not on a national scale. If anything, there\u2019s a shortage of affordable housing, and not enough housing where people actually want to live, she explained. Calling our housing crisis a metropolitan crisis might be better, a housing policy analyst once told<\/a> Fortune<\/em> .\u00a0<\/p>\n Even so, some research has shown single women are buying homes<\/a> more than single men, so maybe they\u2019d save the housing universe? Not a chance, Whitney said. \u201cHow many single women are going to buy four bedroom, three bath homes?\u201d She then brought up the 5 D\u2019s of real estate: diapers, diamonds, divorce, debt, and death. \u201cWithout those\u2026I just don\u2019t think it\u2019s going to be a big enough driver.\u201d<\/p>\n Still, if what she\u2019s predicting comes true, it won\u2019t be another housing crash.<\/p>\n<\/div>\n\nSubscribe to the CFO Daily newsletter to keep up with the trends, issues, and executives shaping corporate finance. Sign up<\/a> for free.<\/div>\n