Housing is the largest single asset for most Americans and yet it accounts for little more than 1% or 2% of the conversation between financial advisors and their clients. That needs to change, according to Jamie Hopkins, director of financial planning at Carson Wealth, a national RIA firm in Omaha, Neb., with almost $20 billion in assets.

For most people near the age of 65, “housing is their largest asset and their largest expense,” said Hopkins in an interview at Schwab Impact last week. Even if they’ve paid of their mortgage, other expenses like taxes, insurance and maintenance require continual cash outlays.

All too often, advisors focus narrowly on the home purchase question, and whether clients should put down the minimum 15% or 20% down payment or go all cash, Hopkins noted. There should be a more extensive analysis of clients’ cash flow and liquidity in the context of larger opportunity costs, he believes.

Given some of the signals coming from the housing market recently, advisors might want to pay attention sooner than later. DoubleLine CEO Jeffrey Gundlach, a speaker at Schwab Impact, predicted that U.S. housing was "doomed” in light of surge in mortgage over the last six months.

A recent Bloomberg article reported that Blackstone’s $70 billion B-RIET, the nation’s largest private REIT and a top-performing investment over the last decade, is experiencing a 15-fold increase in withdrawals in recent months. Inflows into the REIT also slowed although the article noted Blackstone President Jon Gray has personally invested $100 million since July.

Real estate mortgage data and analytics company BlackKnight found that about $1.5 trillion in home equity has vanished since May and the average borrower has lost $30,000 in equity, according to a recent CNBC article. And a leading critique of the Federal Reserve’s interest rate hikes is that is crushing affordability and freezing younger, first-time homebuyers out of the market.

Given that mortgage rates right now are higher than most yields in the bond market, Hopkins said that advisors might want to counsel clients looking to buy a home to put more money down than they might need. Viewing housing as an investment can be a mistake for clients and Hopkins isn’t a fan of using home equity loans to invest in the stock market. Still, that doesn’t diminish its importance for most Americans.

However, some are predicting the downturn is housing is just beginning—prices climbed on average 45% since the pandemic began—and the decline could gain momentum if interest rates remain higher for longer than expected. Hopkins isn’t making predictions but he said it’s well worth a serious conversation with clients to explore all their financing options, from home equity to refinancing to reverse mortgages, even if the client ends up doing nothing.