Week of July 1: The U.S. residential real estate market is kicking off July 2025 with signs of a gradually cooling but still active summer season. Real estate agents nationwide are seeing more homes on the market, modestly rising prices, and slightly lower mortgage rates than earlier this year.
Below is a friendly, data-driven look at how the market is performing this week, with key trends and insights relevant to agents and their clients.
Weekly Highlights (National Trends as of July 1, 2025)
Inventory is Up
Active listings are significantly higher than a year ago – Realtor.com reports active inventory up 27.5% year-over-year, with over 1 million homes for sale nationwide (the highest level since 2019). Redfin’s data also shows active listings up about 14% from last year, reflecting a meaningful boost in available homes. More supply means buyers have more choices this summer.
Listing Activity
New listings (sellers putting homes on the market) are slightly above last year’s pace, but the growth in new supply has slowed in recent weeks. In fact, new listings are up only around 2.5–3.5% year-over-year, a smaller uptick than we saw this spring. Some would-be sellers are holding off on listing, especially those who don’t need to move.
Home Prices Holding Steady
Home prices nationally are flat to modestly up compared to last year. The median sale price is around $400,000, about 1–2% higher year-over-year and essentially at an all-time high. Meanwhile, the median list price (asking price) is up roughly 0.9% year-over-year, indicating sellers are not dramatically increasing prices. About 1 in 5 sellers have resorted to price cuts on their listings, as the market pendulum slowly swings back toward balance.
Homes Selling a Bit Slower
With more inventory and slightly less competition, houses are taking longer to sell than they did a year ago. The typical home is spending about 5 days more on market compared to this time last year. Nationally, the median time on market is roughly 53 days now, which is much more normal and in line with pre-pandemic June levels. (For perspective, during the peak frenzy in spring 2022, homes were snatched up in a blistering ~28 days on median!)
Buyer Demand Mixed but Present
Buyer activity shows signs of life even though it’s not booming. Mortgage applications for home purchases are essentially flat compared to last week and up about 12% from a year ago (when demand was subdued). Home tour requests and other early-stage indicators have ticked up in recent weeks – Redfin’s Homebuyer Demand Index rose ~6% over the last two weeks of June, and home touring activity is trending higher than it was at this point in 2024. That said, pending home sales (homes under contract) are still about 2% lower than a year ago, reflecting that many buyers remain cautious.
Mortgage Rates Ease Slightly
30-year fixed mortgage rates are averaging in the mid-6% range right now. The daily average rate to start July was about 6.67%, down from roughly 7.1% five weeks earlier. This is the lowest mortgage rate in about three months, giving buyers a bit of relief. In practical terms, a buyer with a $3,000 monthly budget can afford roughly a $455,000 home at a 6.65% rate, which is $16,000 more purchasing power than they had when rates were just above 7% in late May. Lower rates have helped stabilize demand somewhat, though today’s rates are still high enough to be a headwind for many house-hunters.
With those big-picture highlights in mind, let’s dive a bit deeper into what’s driving this week’s market trends and how clients might be feeling about the current environment.
Inventory Trends: More Homes, More Breathing Room
After years of razor-thin inventory, the housing supply is finally expanding on a national scale. For the 85th consecutive week, the number of homes for sale is up annually. As of late June, total active listings crossed the one-million mark, a level we hadn’t seen since before the pandemic.
In fact, housing inventory is gradually returning toward pre-2020 levels, which is welcome news for buyers and agents alike. According to HousingWire, the once “chaotic and unhealthy” pandemic-era market is giving way to a more normal environment now that active inventory has rebounded closer to pre-pandemic levels.
More Supply = More Options
This growth in inventory means house hunters have more options to choose from and less pressure to rush into a purchase. Buyers can take a bit more time to comparison-shop, rather than feeling forced to bid immediately in fear of missing out. Indeed, homes are sitting on the market longer on average – about five days more than last year, as noted above. Many agents are observing that bidding wars have eased in most areas, and price reductions are becoming more common when a home doesn’t sell right away. With 36.6% of listings now going off-market within two weeks, down from about 40% a year ago, the market pace is clearly slower than it was last summer.
It’s important to note that while inventory is up from last year’s extreme lows, it remains below historic norms in many places. Some regions (particularly parts of the Midwest and Northeast) still have sizable housing supply gaps relative to pre-2020 levels.
However, markets in the South – boosted by a surge in new construction – have surpassed their pre-COVID inventory levels. For agents, this means the degree of “breathing room” for buyers can vary by region. Nationally, we’re around 4 to 4.5 months of supply, which is edging closer to a balanced market (traditionally defined as 5–6 months of supply).
In June, NAR measured about 4.6 months of inventory for existing homes, a dramatic improvement in choice compared to the ultralow ~2 months supply during the height of the pandemic market. Overall, the trend is clear: inventory is gradually improving, tilting conditions ever so slightly more in favor of buyers.
Seller Participation is Lukewarm
New listings have increased modestly from last year, but we’re not seeing a big flood of sellers. For the week, new listings are only up by low single digits (%) year-over-year. In fact, Redfin notes this is the smallest annual increase in new listings in five months – suggesting potential sellers are starting to lose some motivation. One reason is that many homeowners are locked in with low mortgage rates from prior years and are reluctant to give those up. Others simply feel they “missed the prime selling window” of 2021-2022 and prefer to stay put unless they have to move.
“Understandably, sellers want to get as much money as they can,” explains one Redfin agent, “so many people who don’t need to sell right now are holding off… either staying put or even renting out their house”.
The takeaway for agents: seller hesitancy is keeping the lid on new supply. Those who do list need to be educated that they aren’t likely to get 10 offers on day one in this shifting climate. It’s all about setting realistic expectations – pricing homes competitively and being willing to make repairs or concessions if needed to attract today’s more selective buyers.
Home Prices and Affordability: High, But Leveling Off
Despite the cooler market dynamics, home prices nationally remain near record highs, largely due to the earlier severe lack of supply. The median sale price of U.S. homes is roughly $400K, which is up about 1–2% compared to this time last year. In fact, Redfin’s tracking shows this is an all-time high median sale price, marking a subtle year-over-year increase after prices had stagnated or dipped in some of 2024. Essentially, prices have been holding steady, with no major drop nationally, thanks to still-strong buyer demand for the limited homes available.
However, the price growth has cooled way down from the double-digit jumps seen during the pandemic boom. A year ago, annual price appreciation was higher; now it’s under 2%. Realtor.com’s data on asking prices reinforces this flat trend: the median list price is less than 1% higher than a year ago (and actually slightly down year-to-date).
In other words, the market has essentially hit a price plateau. Buyers aren’t seeing prices skyrocket anymore, but neither are they broadly seeing deep discounts. For agents counseling buyers, this means you likely won’t find dramatic bargains in most markets – but you also don’t need to warn clients about runaway prices. Expect stable or only gently rising prices in the near term.
Crucially, pricing strategy has become more important for sellers. With inventory up and buyers gaining negotiating power, overpriced listings will sit. Approximately 20% of sellers are cutting their initial prices to entice buyers. We’re also seeing the average sale-to-list price ratio dip slightly below 100%, whereas a year or two ago the average home was selling over the asking price.
Today’s sellers often need to price competitively and cannot count on bidding wars to drive up the final sale price. The upside is that most sellers still have substantial equity – home values climbed so much in the past few years that even a small recent dip in some markets leaves many homeowners in a great position.
Nationwide, prices are roughly 40% higher than five years ago, so long-term owners are usually selling at a healthy profit. This built-up equity also gives move-up buyers (sellers who become buyers) more flexibility – they can use that equity to make larger down payments or cover closing costs on their next home.
Affordability remains a key concern, though. High mortgage rates and years of price gains have pushed the typical mortgage payment near historic highs, straining buyers’ budgets. By Redfin’s math, the median monthly payment on a median-priced home (with current rates) is around $2,800, which is about 4–5% higher than last year and only slightly below the peak hit in May.
Stubbornly high home prices mean that even with the recent dip in interest rates, many first-time buyers are finding it challenging to afford a home in their desired area. Income growth and a strong job market have helped somewhat – wage increases over the past year give buyers a bit more purchasing power. But in many markets, prices are still outpacing incomes, keeping affordability front-and-center.
Agents should be prepared to strategize with buyers on this front: whether it’s considering smaller homes/condos, looking at different neighborhoods, or utilizing buy-downs and other financing tools to make that monthly payment manageable.
The good news is that the frenzy has subsided – we’re not in an environment of rampant overbids and escalation clauses on every sale. Price trends are much more approachable now for buyers. And for sellers, while you may not get the sky-high price your neighbor got last year without effort, homes that are priced right and show well are still selling at strong values. In short, home prices are high but stabilizing, creating a more balanced playing field for negotiations.
Buyer Activity and Demand Signals
Buyer demand in summer 2025 can best be described as cautiously active. We’re seeing mixed signals: some measures show buyers stepping back, while others indicate they’re very much still in the game.
On one hand, the hard data on sales is a bit underwhelming. Pending home sales (a forward-looking indicator of closed sales) are running slightly below last year’s level – down about 2.3% year-over-year in recent weeks.
The number of homes sold nationwide is still depressed compared to pre-pandemic norms. For context, the latest Existing Home Sales report from NAR showed an annualized sales pace of 4.03 million units in May, which is about 28% below the 2019 volume (and even 0.7% lower than a year ago).
In large part, this slump in sales is due to the affordability challenges and limited inventory of the past year. As NAR’s chief economist Lawrence Yun put it, “persistently high mortgage rates” have kept sales “relatively subdued”, and only lower interest rates are likely to “attract more buyers and sellers to the housing market” again. Many house hunters are indeed sitting on the fence, waiting for conditions to improve.
On the other hand, we have early-stage demand indicators painting a more optimistic picture lately. Redfin’s Homebuyer Demand Index – which tracks buyer inquiries and requests for tours – increased 6% over the last two weeks of June. Similarly, ShowingTime (which monitors home showing appointments) reports that house tours are rising faster this year than at the same point in 2024.
In fact, by the end of June, home touring activity was up 33% from the start of the year, a stronger uptick than last year’s seasonal trend. Additionally, Google searches for phrases like “homes for sale” spiked to the highest level in 10 months in late June.
All of this suggests there is pent-up buyer interest: people want to buy homes, and many are actively looking. They’re just being more deliberate and selective in acting on those desires.
Another piece of good news: mortgage purchase applications (a proxy for buyers getting loan pre-approvals and making offers) have seen a modest lift from last year’s lows. According to the Mortgage Bankers Association, purchase loan applications are roughly 12% higher than the same week a year ago.
They are essentially flat week-to-week right now, but the year-over-year gain is notable – last June, rates were spiking and buyer activity was throttling back, so this year’s early summer demand is a bit stronger by comparison. Realize that this is still a far cry from the boom times; application volumes remain well below 2019 levels.
But the fact that more buyers are applying for loans than did last summer is a sign that affordability, while strained, is not completely killing demand. Many first-time buyers especially are finding ways to stay in the game (opting for smaller homes, FHA/VA loans, or assistance programs to make it work).
Who are Today’s Buyers?
We’re seeing that demand is strongest for well-priced, move-in-ready homes. Starter homes and more affordable segments garner interest, but these buyers are extremely price-sensitive due to higher interest rates.
In contrast, the upper end of the market is slower – many discretionary move-up buyers or luxury buyers are holding off, often because they don’t need to move and don’t want to trade a low mortgage rate for a higher one.
Investors have also pulled back compared to the last few years, which removes some competition for regular buyers. Overall, the buyers in the market today tend to be either those motivated by life changes (marriage, kids, job relocations) or those who sat out the craziness before and are cautiously re-entering now that things are a bit less frenzied.
For agents working with buyers, the key is to stay on top of new listings and be ready to move when a client’s target home hits the market – but also to coach patience. The rising inventory means that if a particular deal doesn’t work out, there’s a decent chance a similar home will pop up for sale soon.
That’s a refreshing change from a couple of years ago, when missing out on a house felt devastating due to scant alternatives. Now, buyers can afford to be a bit choosy, which is a healthy development.
Mortgage Rates and Financing Climate
Mortgage rates continue to be the make-or-break factor for many buyers. The 30-year fixed rate is hovering in the upper-6% range as we enter July. According to daily market surveys, rates have dipped to around 6.7%–6.8% at the moment.
This is a slight improvement from earlier in 2025 – for example, in May the 30-year rate was often above 7%. Hitting 6.67% at the start of July marked the lowest average rate since early April. By contrast, one year ago (July 2024), rates were roughly in the mid-6% range as well, so we’re in a similar territory.
The recent easing of rates by a few tenths of a percent has tangible effects: as mentioned, it boosted a buyer’s budget by thousands of dollars in purchasing power.
Any house hunter who was pre-approved back in May or June might now qualify for a slightly higher price point, thanks to that dip in rates. This can also improve monthly payment comfort – for instance, the monthly payment on a median-priced home is down about $40 from its peak due to the rate drop.
However, it’s important to keep perspective: 6.7% is still relatively high by historical standards. We’re a long way from the 3% rates buyers enjoyed in 2021. The Mortgage Bankers Association reported that the average 30-year contract rate edged up to about 6.88% last week (their survey for the week ending June 20).
So while rates have wobbled down a bit recently, they continue to fluctuate in the mid-to-high 6’s, and many forecasters expect them to stay in this zone for a while.
As one MBA economist noted, financial market uncertainties (from economic conditions and even global conflicts) have kept mortgage rates in a “narrow range” around the high-6% mark. Until there’s a bigger move in inflation and Fed policy, we might not see rates tumble much further in the short term.
For current homeowners, these higher rates are a disincentive to sell (since they likely have a much lower rate locked in). For buyers, it’s a hurdle for affordability. Yet, buyers are adjusting their strategies rather than exiting the market altogether. We already discussed some choosing cheaper homes or loans.
We’re also seeing more buyers paying points or using temporary rate buydowns to reduce their initial rate. Adjustable-rate mortgages (ARMs) have a small uptick in popularity – they made up about 7% of loan applications recently, as some buyers look for any edge to lower their rate in the first years of the loan.
Refinance activity has also seen a tiny spark with the recent rate dip, though it’s mostly limited to FHA refinances and such. Overall refi volume is still very low (since most homeowners already have far lower rates).
The refinance share of mortgage activity is about 38%, which is actually higher than a year ago – many refi deals now are cash-out refis for those who want to tap equity, or homeowners with loans from before 2020 who somehow missed prior refi waves and are finally doing it now.
Market Sentiment: A Gradual Shift Toward Balance
How are buyers and sellers feeling right now? In a word: cautiously optimistic. The mood has improved from the frustration and fatigue many felt last year, but there’s still caution in the air.
Buyer Sentiment
Buyer sentiment is perking up as conditions become a bit more favorable. Consumers are seeing more signs that the market is not as crazy as it was. With inventory improving and prices leveling off, many buyers feel a sense that opportunities are opening up. A steady job market and rising wages are also bolstering confidence – people feel more secure in their employment and finances, which is a key ingredient for homebuyer optimism.
We can see this optimism in surveys and behavior: as noted, Google searches for homes are high, tour bookings are up, and purchase applications have risen from last year. That said, buyers remain price-conscious and selective. High mortgage rates and memories of recent economic uncertainty (like recession talk) keep them from throwing caution to the wind.
Essentially, buyers are hopeful but still diligent – they’re willing to act, but only if the deal makes sense. They also know they might have a bit more negotiating power now. With more listings to choose from, today’s buyer is more likely to negotiate on price or ask for repairs/credits, whereas two years ago they might have waived contingencies just to compete.
Many agents report that in their local markets, the balance of power is inching back toward buyers, though not swinging all the way; it’s closer to a balanced market than we’ve seen in a long time.
Seller Sentiment
Seller sentiment is more of a mixed bag. On one hand, homeowners realize they still hold a lot of cards – after all, prices are near record highs and most sellers are sitting on plenty of equity. If they’ve owned their home at least a few years, they’re likely to make a healthy profit on the sale.
There’s also an understanding that well-maintained, reasonably priced homes can still sell quickly in many areas (especially if inventory is tight in that neighborhood). So confident sellers do exist, and some markets are even seeing multiple offers on the most desirable listings. On the other hand, many potential sellers are nervous about the market’s turn.
We’ve heard from some who feel they’ve “missed the peak” and are kicking themselves for not selling last year. Others simply don’t want to trade their 3% mortgage for a 7% one on the next house – that “lock-in effect” is real. As a result, a good number of homeowners are staying put (or even renting out their homes) rather than selling into what they perceive as a cooler market.
Those who do decide to list are often people who need to sell (due to life events, relocation, etc.), and they’re approaching the process more soberly. They’re increasingly willing to price their homes competitively and entertain negotiations.
The advice agents are giving such sellers is exactly that: price realistically, know your local stats (days on market, sale price trends), and be open to concessions if that’s what it takes. The era of naming any price and expecting a bidding war is over.
Overall Market Outlook
As we head deeper into summer 2025, the national housing market is moving toward a healthier equilibrium. We are far from a crash – in fact, home values are generally steady.
But we’re also past the extreme seller’s market conditions; it’s no longer true that anything and everything will sell in a weekend. Economists and industry observers are largely encouraged by this trend. HousingWire’s analysts noted that getting inventory back up toward normal levels was a “necessary adjustment” to end the “savagely unhealthy” market of the pandemic years. More supply and slower price growth are ultimately positive for the market’s long-term sustainability.
For agents, this balanced environment may require sharpening your skills in pricing, marketing, and negotiation – homes won’t “sell themselves” quite like they did in 2021, but a well-prepared listing can still succeed quickly. Likewise, working with buyers might involve writing a couple of offers and negotiating repairs again, rather than simply racing to outbid competitors.
In short, real estate fundamentals are back in play, and experienced agents who guide clients with data and clear expectations will shine.
What Might Clients be Feeling?
Many buyers this week are likely feeling a bit of relief – relief that they have more homes to look at, and maybe a bit more time to decide. They’re still anxious about high monthly payments, but they’re also tired of waiting on the sidelines. If mortgage rates keep inching down, expect some of those on-the-fence buyers to finally take the leap.
Sellers might be experiencing a mix of gratitude and grief: grateful that prices are holding up so they can get a good price, but a little disappointed that they missed last year’s red-hot market and now may have to work harder to attract a buyer.
It’s the job of us as real estate professionals to empathize with those feelings and provide the best guidance. Remind sellers that today’s market, while cooler, is still very solid historically – an accurately priced home will sell, and likely at a great price by 2019 standards.
Remind buyers that they have a real opportunity now to purchase without the insanity of 20 competitors, and that they can always refinance later if/when rates drop (whereas the purchase price is locked in forever).
As always, stay calm and sell on!
Sources
Jiayi Xu
Logan Mohtashami