In the past 48 hours, the US housing industry has been marked by growing volatility and mixed signals. Recent data shows that national home prices are undergoing a regionally split adjustment. According to a July 2025 market report, prices declined year-over-year in 33 out of the top 50 metropolitan areas, signaling that many local markets now favor buyers after years of strong seller advantage and rising prices. The national median days on market has risen to about 40, indicating that homes are taking longer to sell, and more listings are seeing price reductions as sellers face more competition and less urgency from buyers.

Yet, industry forecasts remain moderately optimistic in the medium term. Experts project a sustainable national home price growth of 3.4 percent for 2025 and around 3.3 percent for 2026, likely totaling nearly 20 percent growth over the next five years. This forecast reflects ongoing demand drivers such as demographics and a long-term desire for homeownership, even as affordability pressures persist.

Markets with the most demand in 2025 are dominated by well-qualified buyers with above-average incomes and higher down payments. In the hottest ZIP codes, average down payments ranged between 42,000 and 143,000 dollars, compared to a national average of 30,000 dollars, and buyers’ typical household income was 114,000 dollars, notably higher than the national average.

One critical issue is supply. Despite high prices, new home construction has not kept pace with demand, especially in Sunbelt cities like Dallas and Atlanta, where regulatory barriers and political factors have slowed development. Affordability is now the leading barrier for buyers, eclipsing even a lack of inventory. The average 30-year mortgage rate as of late July was 6.72 percent, a slight drop could encourage more activity, but rates remain high compared to pre-pandemic lows, limiting some buyers’ budgets.

Industry leaders and agents are responding by expanding service offerings and advising buyers to take advantage of growing market opportunities. Real estate professionals remain confident, expecting a rebound in existing-home sales by late 2025 and a strong recovery in 2026 as the rate environment improves. Overall, the industry is experiencing a reset from the frenzy of double-digit gains toward a more stable and competitive market with regional differences in pricing, supply, and buyer behavior.

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This content was created in partnership and with the help of Artificial Intelligence AI