Week of June 9: The U.S. housing market in early June 2025 is showing a mix of familiar challenges and refreshing changes – call it a “new normal” with a twist. Here’s what real estate pros need to know, broken down in plain English.
💵 Mortgage Rates: The High-Dive Plateau
After giving us a scare by breaching 7% earlier in the year, mortgage rates have settled (for now) in the high-6% range. As of late May, the average 30-year fixed rate hovered around 6.8%. That’s significantly higher than the ultra-low rates of a few years ago, and yes, it’s still the grumpy cat at our summer house party – dampening some buyers’ enthusiasm.
Many house hunters are making peace with these rates by adjusting their expectations (smaller homes, different neighborhoods, or creative financing), but others are sitting on the sidelines, hoping for a dip.
The takeaway for agents is that affordability is front-of-mind. Be ready to counsel buyers on rate buydowns, ARMs, or other strategies to help navigate this higher-rate environment, because those 3% days aren’t walking back through that door anytime soon.
🆙 Inventory Up, Negotiation Power Up
Here’s a bright spot... we actually have more homes to sell now! Inventory of existing homes is up about 20% from a year ago, reaching the highest levels in nearly five years. (Can we get a whew?)
This spring, unsold listings bumped up to a 4.4-month supply – still a tad under the 5-6 months considered a balanced market, but a big improvement from the ultra-tight 3.5-month supply last April.
In real terms, buyers finally have a bit more breathing room and room to negotiate. Bidding wars are less frenzied; in fact, NAR’s chief economist Lawrence Yun notes that with inventory at a 5-year high, consumers are in a better spot to haggle for deals. We’re seeing this play out with more contingent offers, inspection requests, and price reductions – things that were rare creatures during the 2021 frenzy.
Sellers, meanwhile, are learning that today’s buyer won’t always waive every contingency under the sun. It’s a slight pivot toward sanity, and that’s healthy. Bottom line is more listings = more opportunities, but pricing and presentation matter when buyers have options.
🏠 Home Prices: Holding Steady (No Crash, No Problem)
For all the talk of a housing correction, home prices nationally are holding firm – with a gentle upward lean. April 2025 delivered a $414,000 median existing-home price, the highest on record for that month and about 1.8% higher than a year ago. So no, we’re not in a price freefall.
Prices did soften in some overheated markets (the South and West saw slight year-over-year declines), but the Midwest and Northeast actually notched modest gains. Think of it as the market playing tug-of-war: regions are having different experiences, but overall, the rope’s not moving dramatically in either direction.
Importantly, this price stabilization comes with slower sales – April sales were the slowest for that month since 2009, down about 2% year-on-year. Fewer sales but still-firm prices suggest that sellers who aren’t getting the price they want are simply staying put, keeping inventory from flooding in too fast.
As an agent, you can reassure clients that we’re in a balanced “hold steady” pattern. Buyers aren’t likely to score a 20% discount off last year’s prices, but steady prices plus more choice are a win compared to the frenzy of yesteryear.
👩 Buyer & Seller Check-In: Adjusting to the New Normal
Who’s in the game right now? First-time buyers are inching back, making up about 34% of home sales – a smidge up from 33% a year ago. Not exactly a stampede, but every little bit helps. High rates and prices are still a one-two punch for newbies, so many are relying on creativity (and sometimes family help) to jump in.
Meanwhile, investors and cash buyers have pulled back slightly (cash deals are 25% of sales, down from 28% a year ago), which is giving regular folks a better fighting chance.
Sellers have gotten the memo that it’s not 2022 anymore - we’re seeing more realistic listing prices and a willingness to make repairs or concessions.
One fun fact – new home builders are hustling to entice buyers, since they’re competing with the growing resale inventory. Builders have been cutting prices or offering juicy incentives (upgrades, closing cost help, you name it) to get deals done. If you’ve got buyers, it’s worth checking out new construction developments for promos.
All told, the early summer 2025 market is cooler than the past few years, but far from ice-cold. Think lukewarm lemonade: not boiling over, not frozen – just a refreshingly normal temperature.
For agents, that means honing those negotiation skills again, managing client expectations on timelines, and staying on top of local trends (because all real estate is local, and your area might be an exception to the national groove).
It’s a different vibe from the hyper-competitive days, but many would say it’s a welcome change. Here’s to a summer of steady, sustainable business – and maybe actually enjoying a weekend BBQ without the phone blowing up!
Happy selling, and have a fantastic rest of the week and holiday weekend.