US Housing Market Cools: Slower Growth, Buyer Leverage, and Adapting Strategies

In the past 48 hours, the US housing industry has shown renewed signs of cooling, continuing a trend that emerged earlier this summer. As of August 2025, the 30-year fixed mortgage rate is around 6.63 percent, keeping affordability a key concern for buyers. Although speculation is high that the Federal Reserve will cut rates in September, most experts agree that any major relief is unlikely before 2026.

Recent data from the National Association of Realtors show US home price growth has slowed. At the end of the second quarter, the national median sale price for existing single-family homes reached 429,400 dollars, up just 1.7 percent year over year, which is a slower growth rate than earlier this year. Only five percent of metro areas posted double-digit price gains, down from eleven percent in the first quarter. Regional trends reveal sharper slowdowns in the South and West, with Austin, Phoenix, Tampa, Boise, and Las Vegas highlighted as markets where prices are now most vulnerable to deeper declines, as oversupply or reduced migration pressure values downward.

Buyers are gaining more leverage as active listings increase. Inventory grew in the spring, but the pace has now begun to moderate as some sellers opt to pull listings off the market rather than reduce prices. New listings growth slowed from over nine percent in April to six percent in June as more homeowners decide to wait out current conditions.

In response, sixty-two percent of builders are employing aggressive incentives like mortgage rate buydowns, closing cost help, and even outright price cuts, particularly in Southern and Western states. This creative strategy is necessary to encourage transactions in the face of high borrow costs and persistent inflation. Large developers are focusing their building efforts in Sunbelt markets, including Dallas-Fort Worth, which continue to show investor interest and relative resilience.

Rental markets are also shifting. The national rental value index rose by three percent year on year as of July, with Darwin, Perth, and Brisbane leading regional value growth. However, the spread between house and unit prices reached historic highs in some cities, highlighting how persistent supply constraints and market imbalances continue to shape consumer decision-making.

Compared to the same period last year, the US housing market is now skewed towards buyers, with more incentives and some pricing moderation, but sellers and builders are actively adapting in an attempt to keep the market in motion.

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Episode Transcript

Speaker 1 (00:00):
In the past forty eight hours. The US housing industry
has shown renewed signs of cooling, continuing a trend that
emerged earlier this summer. As of August twenty twenty five,
the thirty year fixed mortgage rate is around six point
six three per cent, keeping affordability a key concern for buyers.
Although speculation is high that the Federal Reserve will cut

(00:21):
rates in September, most experts agree that any major relief
is unlikely before twenty twenty six. Recent data from the
National Association of Realtors show US home price growth has slowed.
At the end of the second quarter, the national median
sale price for existing single family homes reached four hundred

(00:42):
twenty nine thousand, four hundred dollars, up just one point
seven per cent year over year, which is a slower
growth rate than earlier this year, only five percent of
metro areas posted double digit price gains, down from eleven
per cent in the first quarter. Regional trends reveal sharper
slow downs in the South and West, with Austin, Phoenix, Tampa, Boise,

(01:05):
and Las Vegas highlighted as markets where prices are now
most vulnerable to deeper declines as oversupply or reduced migration
pressure values downward. Buyers are gaining more leverage as active
listings increase. Inventory grew in the spring, but the pace
has now begun to moderate as some sellers opt to

(01:27):
pull listings off the market rather than reduce prices. New
listings growth slowed from over nine per cent in April
to six per cent in June as more homeowners decide
to weigh out current conditions. In response, sixty two per
cent of builders are employing aggressive incentives like mortgage rate

(01:48):
by downs, closing costs help, and even outright price cuts,
particularly in southern and Western states. This creative strategy is
necessary to encourage transactions in the face of high borrow
costs and persistent inflation. Large developers are focusing their building

(02:09):
efforts in Sun Belt markets including Dallas Fort Worth, which
continue to show investor interest and relative resilience. Rental markets
are also shifting. The national rental Value index rose by
three percent year on year as of July, with Darwin,
Perth and Brisbane leading regional value growth. However, the spread

(02:35):
between house and unit prices reached historic highs in some cities,
highlighting how persistent supply constraints and market and balances continue
to shape consumer decision making. Compared to the same period
last year, the US housing market is now skewed towards
buyers with more incentives and some pricing moderation, but sellers

(02:59):
and builders are acts actively adapting in an attempt to
keep the market in motion.