John Matheson, a house inspector in Alameda, Calif., stored busy throughout the pandemic when the housing market was pink scorching. However as rates of interest began to rise about midway by means of 2022, he observed that his workload started to drop. Final yr, the variety of jobs plummeted.

“My enterprise is about 50 % of what it was,” mentioned Mr. Matheson, who works as a contractor for BPG Inspections, which supplies companies to residence patrons throughout the nation. “So far as I’m involved, it’s a very dangerous yr.”

So dangerous, in reality, that “I’m really fascinated by facet hustles,” he mentioned, including that he’s finding out to obtain a industrial captain’s license within the hope of getting a job working a ferry or one other vessel if the housing market doesn’t rebound.

Excessive residence costs and elevated mortgage charges, which squeezed the housing market final yr, have dragged down a lot of different associated sectors, like actual property companies and mortgage lending. However housing is such a vital cog within the American financial system that its slowdown has additionally threatened industries like residence enchancment and storage.

“Present residence gross sales are below a lot strain,” mentioned Sean O’Hara, president of the fund-management agency Pacer ETFs. “We’re type of exiting a section the place actual property, throughout the board, had a superb surroundings.”

Gross sales of current houses, which make up a lot of the nation’s housing inventory, had been down roughly 7 % in November from a yr earlier, in keeping with the Nationwide Affiliation of Realtors.

Federal Reserve policymakers held rates of interest regular at their assembly in December and signaled that the central financial institution would start chopping rates of interest in 2024, providing hope to the residential market, which is extra delicate to interest-rate modifications.

The elements that stored folks from shopping for a house in 2023 had been myriad, together with hovering costs. The median worth of an current single-family residence was $392,100 in November, in keeping with the Federal Reserve Financial institution of St. Louis, making residence shopping for unaffordable for a big swath of the inhabitants, whilst mortgage charges have dipped beneath 7 %.

Would-be patrons are additionally dealing with a scarcity of homes in the marketplace. Some householders don’t need to promote their houses and forfeit the low mortgage charges they landed just some years in the past. About 4 out of 5 householders with mortgages have a fee decrease than 5 %, and a couple of quarter have a fee decrease than 3 %, in keeping with a examine carried out by the web brokerage Redfin. Even child boomers who would possibly take into account downsizing are discovering that it may not be cost-effective to take out a brand new mortgage with charges at their present ranges.

The contagion from the slowdown within the housing market final yr has been wide-ranging.

Professionals like actual property brokers and mortgage suppliers are essentially the most seen collateral injury, however different service suppliers — corresponding to title insurance coverage corporations, escrow corporations, residence appraisers and inspectors — are additionally seeing enterprise dry up. Different once-hot markets are seeing an identical shift.

“Our greatest yr within the enterprise was 2021, on the peak of Covid,” mentioned Scott Patterson, proprietor of Hint Inspections, which supplies residence inspections within the Nashville space. “Then rates of interest began going up, and other people simply stopped shopping for houses except they actually wanted to.”

Mr. Patterson mentioned a mix of low stock and excessive mortgage charges was slowing the variety of residence purchases, notably amongst first-time patrons.

“Of us which were affected essentially the most are folks shopping for starter houses,” he mentioned. “Rates of interest are actually hurting them. They’re those we’re not seeing as a lot.”

Firms concerned in shifting and storing folks’s belongings are additionally dealing with a slowdown that executives attribute to slumping residence gross sales. In a name with analysts in August, Edward J. Shoen, president and chief government of U-Haul, blamed a contraction in shifting exercise for a decline within the firm’s first-quarter income.

Demand for storage models boomed throughout the pandemic as folks spent extra time at residence or took benefit of decrease mortgage charges by shopping for a house. Builders capitalized on this, with investor funds fueling the development of recent storage services across the nation.

“What you had within the pandemic and postpandemic was simply an abundance of provide,” mentioned Michael Elliott, an fairness analyst at CFRA Analysis.

As pandemic-era consumption patterns have waned, some corporations have struggled. In September, analysts at Morgan Stanley lower their goal worth of Additional House Storage, and a Wells Fargo analyst printed a analysis notice warning about total softness within the sector.

Storage companies are having to decide on between shoring up occupancy by chopping charges or rising them to generate extra income — on the threat of getting clients defect to opponents.

Owners reworked and redesigned throughout the pandemic, snapping up new recliners, fridges and wide-screen TVs. Now, retailers face a difficult gross sales surroundings.

Demand for furnishings, home equipment and residential electronics has fallen, in keeping with a Financial institution of America evaluation carried out in 2022. Fewer folks shopping for houses has meant decrease demand for big-ticket objects like sofas and residential stereo methods, mentioned R.J. Hottovy, head of analytical analysis on the analytics agency Placer.ai.

So many individuals purchased residence furnishings throughout the pandemic years that these purchases supplanted those who would possibly in any other case be going down now, miserable demand additional. As of the start of September, Placer.ai discovered, visits to home-goods retailers had been down roughly 15 % from a yr earlier, and visits to electronics shops had been down 12 %.

Youthful adults are a giant potential supply of demand for these sorts of products, consultants say, provided that they might usually be in search of to purchase a house to begin a household.

“I believe a whole lot of millennials, specifically, want to transfer, to have a bigger residence,” mentioned Timothy S. Chubb, chief funding officer on the wealth administration agency Girard. “It’s been comparatively not possible to take action, given a scarcity of stock on the market.”

That’s translating right into a decline in spending on sturdy items, he mentioned.

Residence-improvement retailers face comparable challenges. “Something related to shifting just isn’t taking place, and that’s rather a lot,” mentioned Scott Mushkin, the founder and managing associate of R5 Capital, a consulting and analysis agency.

Executives at Residence Depot instructed traders on a third-quarter earnings name in November that People had been shopping for fewer big-ticket objects. Lowe’s reported decrease spending on do-it-yourself tasks in the identical quarter. Residence-improvement retailers usually profit when people who find themselves unable to purchase a brand new residence resolve as an alternative to renovate their present residence. However shoppers had much less urge for food for giant renovations in 2023 as a result of increased rates of interest raised the price of borrowing.

Though the sharp enhance in residence values has given householders extra fairness on paper, gaining access to it has develop into dearer.

“With the housing market the place it’s, persons are not in a position to transfer,” mentioned Mr. Elliott, the CFRA Analysis analyst. “That’s going to have an effect on demand.”