US Housing Market Shows Signs of Stabilizing After Volatility

Over the past 48 hours, the US housing industry has shown signs of stabilizing after two years of volatility. Existing home sales increased by 2 percent in July, reaching an annual pace of 4.01 million units, as mortgage rates slipped to just below 6.6 percent, the lowest level in ten months. This slight improvement in affordability and a 15.7 percent year-over-year jump in inventory have encouraged more buyers to enter the market. Notably, the national median home price in July was 422,400 dollars, up only 0.2 percent from last year. This is the lowest annual price growth in two years and indicates a cooling trend after historic gains.

About half the country is now experiencing either flat or falling home prices. In the West, for example, the median price dropped 1.4 percent to 620,700 dollars, and the South saw a 0.6 percent decrease to 367,400 dollars. Meanwhile, sellers are increasingly willing to negotiate. Roughly 27 percent of July listings had price cuts, the highest share on record according to Zillow. The Midwest and Northeast regions remain more resilient, with price increases of 3.9 percent and 0.8 percent respectively.

On the supply side, housing starts jumped 5.2 percent in July to a 1.43 million annual rate, although building permits—a measure of future construction—fell for the fourth straight month. Multifamily construction is up, led by strong activity in the South, while builder confidence continues to sag at historic lows according to the NAHB.

Leading firms are adapting to the new normal by offering more buyer incentives such as help with closing costs and repairs. They are also responding to greater inventory by accelerating digital marketing and flexible listing strategies. Industry analysts say wage growth now outpaces home price increases, hinting at a long-awaited shift in buyer leverage. However, new entrants still face affordability challenges due to inflated prices, high rates, and competition for limited supply.

Compared to last year’s slump, current conditions offer buyers more options and negotiating power, though the industry remains in a delicate balance, with future price and supply trends hinging on broader economic signals.

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Episode Transcript

Speaker 1 (00:00):
Over the past forty eight hours, the US housing industry
has shown signs of stabilizing after two years of volatility.
Existing home sales increased by two per cent in July,
reaching an annual pace of four point oh one million units,
as mortgage rates slipped to just below six point six percent,
the lowest level in ten months. This slight improvement in

(00:20):
affordability and of fifteen point seven per cent year over
year jump in inventory have encouraged more buyers to enter
the market. Notably, the national median home price in July
was four hundred twenty two thousand, four hundred dollars, up
only zero point two per cent from last year. This
is the lowest annual price growth in two years and
indicates a cooling trend. After historic games, about half the

(00:43):
country is now experiencing either flat or falling home prices.
In the West, for example, the median price dropped one
point four percent to six hundred twenty thousand, seven hundred dollars,
and the South saw a zero point six percent decrease
to three hundred sixty sive seven thousand, four hundred dollars. Meanwhile,
sellers are increasingly willing to negotiate roughly twenty seven percent

(01:07):
of July listings had price cuts, the highest share on record.
According to Zillo, the Midwest and Northeast regions remain more resilient,
with price increases of three point nine percent and zero
point eight percent, respectively. On the supply side, housing starts
jumped five point two percent in July to a one
point four to three million annual rate, although building permits,

(01:28):
a measure of future construction, fell for the fourth straight month.
Multi family construction is up, led by strong activity in
the South, while builder confidence continues to sag at historic lows.
According to the NAHB, leading firms are adapting to the
new normal by offering more buyer instentives, such as help
with closing costs and repairs. They are also responding to

(01:49):
greater inventory by accelerating digital marketing and flexible listing strategies.
Industry analysts say wage growth now outpaces home price increases,
hinting at a long weighted shift in buyer leverage. However,
new entrants still face affordability challenges due to inflated prices,
high rates, and competition for limited supply. Compared to last

(02:10):
year's slump, current conditions offer buyers more options and negotiating power,
though the industry remains in a delicate balance, with future
price and supply trends hinging on broader economic signals.