US Housing News

US Housing Market Outlook: Affordability Challenges, Shifting Trends, and Uncertain Future


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The US housing market remains sluggish and affordability is still a core challenge. Over the past 48 hours, new data show the national median list price reached $439,450 in July, a small increase of just 0.5 percent since last year. Home prices overall are up more than 50 percent since the pandemic began, but wage growth continues to lag, causing home ownership to remain out of reach for many households. Mortgage rates currently hover close to 7 percent, near their 2025 highs, and forecasts suggest they will remain in the 6.5 to 7 percent range through this year, with only minor dips expected in the coming months.

Market activity reflects these affordability headwinds. The supply of homes for sale increased 24.8 percent year over year, marking the 21st straight month of inventory growth. However, active listings are still 13 percent below pre-pandemic levels. Pending home sales, a leading indicator of future closings, dropped 3 percent from last July and new listings shrank 3.9 percent month over month, pointing to potential inventory fatigue. Homes are sitting on the market longer, with median days on market now at 58, seven days slower than last year.

Consumer behaviors are shifting. More first-time buyers are turning to rentals or options like co-living because traditional paths to ownership are so difficult. Only 27 percent of homes sold above list price last month, and price cuts were reported on over 20 percent of active listings. There is a mild slowdown in price growth rather than a sharp correction. Industry leaders such as Zillow and leading brokerages note that unless there is a significant change in interest rates or wage growth, the affordability crisis will likely persist into 2026.

Compared to earlier quarters in the past year, the market is moving more slowly and uncertainty prevails about the timing of any real rebound. The Federal Reserve’s decision to hold rates steady, sticky inflation, and economic uncertainty all mean both buyers and sellers are waiting for clearer signals before acting. For now, the US housing market is characterized by high prices, cautious optimism for lower rates in the future, and a measured but persistent rebalancing between supply and demand.

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