Realtor.com writes, "The sour outlook from consumers, and the consistent "wait-and see" policy from the Federal Reserve, helped push interest rates lower, including mortgage rates dipping to 6.77% for a 30-year fixed home loan. The dip was housing-friendly but small, so its impact will be modest.
Inflation, which showed the Fed’s preferred gauge, rose 2.3% in the year even as the index excluding food and energy prices edged a bit higher. Consumer confidence slipped in June, and while consumer sentiment improved, both measures remain at a concerningly sluggish level.
The April Case-Shiller home price index showed regional divergence, with price gains strongest in Northeast and Midwest markets, like New York City, Chicago, and Detroit. Southern markets—Tampa, FL, and Dallas—were the only two to see price declines in the past year.
Existing-home sales rose in May as the number of homes for sale grew, bringing the months supply to a nearly nine-year high. Nationwide, we’re still short of a buyer’s market, but buyers are gaining market power, especially in the South and West. The median sold price stands at $422,800.
Pending home sales, a forward-looking indicator that measures an early stage in the buying process, also moved higher in May, suggesting that existing-home sales might edge even higher in the months ahead.
But new-home sales fell from both the prior month and the prior year. In recent years, builders had benefited from limited existing inventory that pushed existing sales to 30-year lows, but as more homeowners decide to sell, builders will increasingly face competition for buyers.
Looking at Realtor.com® weekly housing data, we see that home prices eked out a small gain and time on the market slowed less than in prior weeks—even as new listings and active inventory continued to climb. Again, new-listing growth rose at a slower pace than we’ve seen recently, which could slow the buyer-friendly momentum we’ve seen in inventory recovery.
Buyer-friendly trends are paramount because the housing market has been tipped so far in favor of sellers that affordability has defied expectations and made it almost impossible for buyers to stick to the 30% rule, which suggests keeping housing costs to just 30% of your income.
A Realtor.com study found that a median-income buyer of the typical for-sale home could meet this affordability guideline in only three markets in May: Pittsburgh, Detroit, and St. Louis.
But three of the least affordable markets are all in California: Los Angeles, San Diego, and San Jose."
Source: Realtor.com
Written by: Daniel Hale
Published: June 27, 2025
Posted by Grossman & Jones Group on
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