For most Americans, every home purchase is a bit of a gamble. Is now the right time to jump into the market? Can I haggle on the price a bit more? What if mortgage rates drop in a few months? These questions have always made buying a new place feel a little like hitting the blackjack table. For the better part of a century, these implicit bets on future real estate prices have been limited to the small pool of people making a home transaction every year. Plenty of other Americans, however, have an interest in where the housing market is headed — or at least some opinion on the fate of home values. Now, thanks to prediction markets, anyone can put their money where their mouth is. Think the median home value in Austin will end the month under $412,000? Prove it.
Prediction markets are all the rage in politics, sports, and pop culture, so it was only a matter of time before real estate joined the party. Polymarket ushered in the inevitable last week when it debuted markets that allow users to speculate on home prices in a handful of major metropolitan areas such as Los Angeles, Miami, and New York City. Now, anyone can test their luck as an armchair housing economist. As one X user put it: “i cant wait to short my friends house.” The available wagers aren’t nearly so granular — you can’t go full “Big Short” on your coworker’s home yet. These markets instead use real-time figures from Parcl, a housing data and analytics firm, to let people wager on whether the median home price in the US, or one of the select metros, will end the month within a certain range.
The grand promise of prediction markets is that they’ll illuminate what people actually think will happen: Rather than listen to YouTube pundits spout hot takes or real estate agents talk up their respective markets, you can peek at Polymarket to see where people are staking their hard-earned cash. Maybe some agents will make bank from their on-the-ground knowledge — insider-ish trading is sort of the point, after all. Or perhaps some savvy homeowners will use these contracts to hedge their risk and make some money even if the winds of their local real estate market shift against them.
Then again, it’s tough to buy into all this lofty talk of price discovery and hedging when you can make a few clicks on Polymarket and bet on the amount a rare Pikachu card owned by YouTube personality Logan Paul will sell for at auction. And beyond the casino-fication of our economy, the move offers clear evidence of the shifting mentality around real estate. The American home is no longer just a roof over your head or a humble nest egg. It’s a valuable asset ripe for all sorts of financialization, with Wall Street-backed firms clamoring to buy a stake in your property and homeowners tuning their interiors to boring-but-sellable shades of gray, abandoning personal taste in the name of marketability. Like any good commodity, selling a home — or betting on the future value of all the homes around it — should be as frictionless as possible.
Betting on home prices isn’t new, exactly. It’s just never been all that popular. The Chicago Mercantile Exchange introduced housing futures contracts and options in 2006, enabling people to wager on the direction of home values in 10 major markets as well as a nationwide index. Hardly anyone jumped at the opportunity: Housing accounted for fewer than 3,000 of the roughly 2.2 billion contracts that traded on the CME in 2007. In a paper a couple of years later, researchers at the University of North Carolina at Greensboro expressed puzzlement at the lack of interest: “It seems that this market offers a way for individuals, businesses, and others to transfer housing risk, but the low trading volumes in the market indicate that few are willing to utilize this mechanism.” Since then, these contracts have faded further into obscurity. In late 2024, John Dolan, a market maker for home-price futures who also devotes a blog to the topic, wrote that while trading volumes had recently hit a five-year high, it was “only a fraction of what’s possible, needed, and/or the volumes traded in 2006-07.”
Futures contracts may sound a little wonky for a layperson, but betting — excuse me, predicting — is everywhere. Prediction markets offered by Polymarket and its main competitor, Kalshi, allow users to buy “shares” in their expected outcome, with real-time odds reflecting the supposed wisdom of the crowd. For example, Polymarket shows a roughly 47% chance that the median US home value will end the month above $418,000, down from a 73% chance about a week ago, suggesting that recent bettors are less optimistic. These platforms captivated viewers during the 2024 presidential election and have since leapfrogged regulatory hurdles to become a fixture in sports, entertainment, and politics. Their ubiquity has turned the odds themselves into their own bizarro news cycle: In the same week, Golden Globes watchers might grouse about betting tickers spoiling the broadcast (the result of a partnership between the awards show and Polymarket) while lawmakers wring their hands over a suspiciously well-timed wager on Venezuela’s president Nicolás Maduro’s ouster. The unsurprising takeaway is that people love the ease and thrill of online betting. Last year, Kalshi said it had reached an $11 billion valuation, while Polymarket secured a $2 billion investment from Intercontinental Exchange, the owner of the New York Stock Exchange, at a $9 billion post-money valuation.
The case for marrying real estate with prediction markets is that it’s tough to express a view on home prices without spending a bunch of money. If you think prices are about to skyrocket in Boston, the only way to really act on that feeling is to buy a house there, which is “incredibly cash-intensive,” says Trevor Bacon, the CEO of Parcl. And if you think prices are going to drop, that’s even trickier. Beyond CME’s thinly traded futures market, which poses numerous logistical hurdles for retail investors, there has historically been no easy way to bet on home values declining.
“Real estate’s very illiquid, and it’s very hard to get any meaningful exposure at any granularity, from a trading or betting perspective,” Bacon tells me. On the other hand, “there are a lot of various things that people can do with liquid markets.” The first and most obvious, Bacon admits, is naked speculation: You have a gut feeling about prices in a particular city or have heard from a friend in the area that sales are slow, so you put down a few bucks. Eventually, though, perhaps a bustling predictions market could reveal a clearer picture of where home values are headed: If a lot of in-the-know real estate agents are watching their clients struggle to sell their homes, maybe they’ll bet on a softening market in the months ahead, and the odds will shift to reflect that influx of wagers. In the future, buyers and sellers may monitor Polymarket just as they keep tabs on pending sales data or, more likely, the Zestimates hovering next to homes on Zillow. The age-old question of whether it’s a good time to buy or sell might get a little easier to answer.
I think it’s very similar to just opening another casino.Dayong Huang, finance professor at UNC-Greensboro
Polymarket doesn’t yet offer bets on the Denver market, but when I ask Bret Weinstein, a real estate broker there, if he’d take the opportunity once it’s available, he responds with a resounding “Hell yeah.”
“If rates continue to go down, there is a very realistic opportunity that prices will go up,” Weinstein tells me. “So would I bet on that? Yeah, as of right now, I absolutely would. Does that mean I’m going to put my house on it? No.”
Weinstein tells me he views it almost like sports gambling, though he allows that he probably has more insider information than the average Polymarket user. Dayong Huang, a finance professor at UNC-Greensboro, makes the same comparison. “I think it’s very similar to just opening another casino,” he tells me. Unless the markets end up being fairly accurate in forecasting home prices, Huang says, “I don’t see how average Americans benefit.”
The rollout of these markets signals another stage of our bet-pocalypse. It also reveals a long-running shift in how Americans view the places where they live. The median wealth gap between homeowners and renters has widened by 70% since 1989, reaching a historic high in 2022, an Urban Institute analysis of the most recent data from the Survey of Consumer Finances found. For the roughly 65% of US households that own their home, Pew Research Center reported, that residence is typically their most valuable asset. Given the scarcity and sharp price increases, it’s no wonder that people — and companies — would seize upon homes’ money-making potential.
The run-up in home prices a few years ago sure made the market feel like a casino: A bunch of homeowners got rich, and many others rushed to the hot table before it was too late. I can’t fault anyone for wanting a seat at that table without all the costs and headaches of a mortgage. Real estate prediction markets may not fulfill their promise of illuminating future home values or minting a new class of housing wealth holders. If they catch on, though, they’ll show that homes are no longer mere shelter, but commodities to be traded upon.
The running joke is that Polymarket’s foray into real estate reflects a darkly comedic reality for younger generations: Born too late to actually buy a home, but just in time to gamble on home prices (and everything else) from the comfort of their cramped apartments. The move taps into the never-ending intrigue surrounding the housing market’s ebbs and flows — and the widespread desire for a piece of the action. Yet Polymarket users may already be occupied with the vast range of bets at their disposal. Trading volume on the fate of Logan Paul’s Pikachu card has already surpassed $4 million; the crowd seems to think there’s a good chance the card will sell for more than $8 million. Good for Paul. He could probably buy a house with that money.
James Rodriguez is a correspondent on Business Insider’s Discourse team.
Business Insider’s Discourse stories provide perspectives on the day’s most pressing issues, informed by analysis, reporting, and expertise.
