The US housing industry has seen notable shifts over the past 48 hours as updated second-quarter data and analyst commentary signal a market in transition. Nationwide, home prices remain high—up 1.7 percent year-over-year to a record median price of $429,400 according to the National Association of Realtors, but growth is slowing compared to earlier in 2025. Seventy-five percent of metro areas posted price increases, down from eighty-three percent in the first quarter. Only five percent of cities saw double-digit gains, a marked decline from eleven percent earlier in the year. Elevated mortgage rates continue to dampen both home sales and the homeownership rate, which has dropped by a full percentage point since early 2023. Affordability concerns are most acute in fast-growing Sun Belt markets such as Austin, Phoenix, and Tampa, where oversupply and stretched prices are fueling corrections. Austin stands out for sharp price drops, and cities like Boise and Las Vegas are now facing visible slowdowns as inventory outpaces demand and migration slows. Meanwhile, the Midwest and Northeast are outperforming, buoyed by affordability and limited inventory, with the Northeast’s median price up 6.1 percent year-over-year. The Midwest is up 3.5 percent. New supply is becoming a dominant force—multifamily completions hit record levels in 2024 and continue to exceed net absorption, though vacancy rates stabilized near 6.5 percent in the most recent quarter. Permitting has slowed, suggesting future supply pressures may ease. Fitch Ratings noted that US home prices remain about ten percent overvalued but this is gradually normalizing, down half a percentage point from last quarter. Some local markets, such as Naperville, Illinois, still show seller-friendly conditions, with homes selling in under two weeks and at 100 percent of asking price. Industry leaders are responding with more conservative building strategies and emphasizing product diversity, especially in multifamily and affordable housing segments. Compared to previous quarters, the market is shifting from a tight seller’s market to a more balanced environment, with more inventory, slower growth, and greater room for buyers to negotiate.

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