The CEO of Meredith Whitney Advisory Group, whose prediction of the Great Financial Crisis earned her the moniker “Oracle of Wall Street,” pointed out in a Financial Times op-ed that more than 54% of homes are owned by seniors, up from 44% in 2008.

She added that 79% of seniors own their homes, and three-fourths of them don’t have a mortgage, meaning they have an enormous amount of equity that can help cover rising homeownership costs, such as insurance.

“This has made it easier for seniors to hold on to their homes by tapping into some of this built-up equity,” Whitney explained. “And growth in such funding will be a major theme for the US economy in the next three to four years.”

The cheapest and fastest-growing form of consumer debt is now home equity lines of credit, demonstrating how much housing has become a financial resource, and seniors account for 41% of revolving home equity credit outstanding, she said.

Other debt products and new forms of credit are also available to homeowners who want to squeeze some cash out of their properties. The upshot is that housing inventory will remain limited as boomers are less inclined to downsize to smaller homes and have the financial means to stay put.

“That means the housing market will continue to be very different from before. There will be no quick fixes,” Whitney warned. “Even as 30-year mortgage rates decline, don’t expect existing home sales to pick up materially. Seniors control the proverbial chessboard, and with so many options, they aren’t moving anytime soon.”

That’s bad news for millennials and Gen Zers trying to enter the housing market.  In fact, the housing market has become so unaffordable for these buyers, the number of first-time home buyers shrank to a historic low.

In May, Whitney also noted that many boomers can’t afford to move out and have been borrowing against their homes to stay where they are.

To be sure, boomers collectively have $75 trillion of wealth. But that’s not distributed evenly, and Whitney estimated that just one in 10 seniors can afford assisted-living facilities.

“Seniors are living paycheck to paycheck,” she told Bloomberg TV. 

The drag from boomers on the housing market is just one of several. As President Donald Trump’s tariffs and immigration crackdown hit homebuilders, the supply of new homes is slowing.

Meanwhile, economic anxiety and still-elevated home prices are weighing on demand from prospective homebuyers, even as mortgage rates dip, and that’s spilling over to homeowners, who are increasingly pulling listings off the market.

The weak housing market even threatens to bring down the overall economy. The economist Ed Leamer, who passed away in February, famously published a paper in 2007 that said residential investment is the best leading indicator of an oncoming recession.

In the second quarter, residential investment tumbled 4.7%, accelerating from the first quarter’s 1.3% decline.

In July, Moody’s Analytics chief economist Mark Zandi singled out the housing market for concern, escalating it to a “red flare” as home sales, homebuilding, and house prices were getting squeezed by high mortgage rates.

At the same time, residential building permits—a key indicator of home construction—have been falling, and Zandi warned earlier this month that they are “the most critical economic variable for predicting recessions.”

That data is a major factor in Moody’s leading economic indicator, which estimates the odds of a recession in the next 12 months are now at 48%.

Even though it’s less than 50%, Zandi pointed out that the probability has never been that high previously without the economy eventually slipping into a downturn.