November Housing Report: Opportunities Amid Uncertainty

We know how important it is for our members to stay informed about the housing market, whether you’re planning to buy, sell, or simply keep an eye on trends. That’s why we put together these monthly updates—to cut through the noise, provide clear insights, and give you the tools to make confident decisions.

As we move toward the end of the year, the housing market continues to evolve. From fluctuating mortgage rates to shifting buyer and seller dynamics, here’s a comprehensive look at the latest trends, sourced from Zillow, Redfin, the National Association of Realtors, and Steven Thomas' Reports on Housing.

Zillow: Unpredictable Mortgage Rates Shape the Market

Mortgage rates fell to a two-year low in September, giving middle-income households access to a greater share of the housing market. In September, 27.3% of homes were affordable for middle-income buyers—the highest since February 2023. However, rates bounced back in October, bringing uncertainty.

Affordability remains a major hurdle for buyers. For example, a household earning the median U.S. income gained access to 75,000 more homes in September when rates dipped to 6.18%, compared to May when rates were at 7.06%. That said, volatility is expected to continue, with Zillow predicting mortgage rates to trend lower in 2025, though not without significant swings.

In October, affordability improved year-over-year in all 50 largest metro areas.  Cities like Pittsburgh, St. Louis, and Buffalo offered the highest share of affordable listings, while markets like Los Angeles and New York City, although improved over 2024, remained largely out of reach for middle-income buyers due to limited housing supply.

Redfin: Demand Resilient Despite High Rates

Even with mortgage rates climbing back to nearly 7%, Redfin reported strong early-stage homebuyer demand in November. Pending home sales rose 4.5% year-over-year for the four weeks ending November 17, and buyer inquiries reached their highest level in 15 months. Redfin attributes this activity to pent-up demand following the election and recent rate cuts by the Fed.

Although affordability challenges persist, some buyers are accepting the reality of higher rates and opting for adjustable-rate or FHA loans. Sellers, meanwhile, are seeing steady demand, particularly in areas with desirable features like good schools and lower property taxes.

“The market is moving surprisingly quickly for this time of year,” noted Redfin Premier Agent Meme Loggins. “Buyers are seizing opportunities where prices are slightly lower than a year ago, and competition is heating up.”

National Association of Realtors: Sales and Prices on the Rise

The NAR reports a 3.4% increase in existing-home sales in October, marking the first year-over-year gain since July 2021. Sales climbed across all U.S. regions, with the Midwest leading the charge at 6.7% growth month-over-month. Inventory rose 19.1% compared to last year, offering buyers more choices.

Median home prices continue to rise nationwide, reaching $407,200 in October—up 4% from a year ago. Lawrence Yun, NAR’s Chief Economist, sees positive signs in increasing inventory and economic growth. However, elevated mortgage rates remain a critical challenge, especially for first-time buyers.

Steven Thomas’ Reports on Housing: Pricing Strategies Key for Sellers

Setting the right asking price is more critical than ever in today’s slower-paced market. Steven Thomas likens the process to marathon training—it requires careful preparation and a step-by-step approach. Addressing maintenance, enhancing curb appeal, and consulting a seasoned real estate agent are essential steps for sellers looking to maximize their sale price.

“Arriving at the ultimate asking price is not guesswork,” Thomas emphasizes. Overpricing a home to "test the market" can lead to long market times and missed opportunities. Buyers scrutinize every detail of a listing before deciding to view it in person, making the initial price a key factor in attracting interest. Homes that linger on the market often fail to generate the excitement of newly listed properties, even after price reductions.

Looking Ahead

Zillow’s forecast for 2025 points to a more active housing market, with increased inventory and slower home value growth of 2.6%. While mortgage rates are expected to ease, volatility will remain a defining factor. Redfin’s insights suggest that post-election optimism and pent-up demand could fuel increased competition, pushing prices higher unless inventory rises significantly.

Top 7 Key Takeaways from November's Housing Market:

1. Mortgage Rate Volatility Impacts Affordability
   Mortgage rates fell to a two-year low in September, briefly boosting affordability and allowing middle-income households to afford 27.3% of homes on the market. However, a sharp rise in October pushed many buyers back to the sidelines, underscoring the ongoing challenge of rate unpredictability.
2. Home Prices Continue Steady Growth
   Home prices rose 0.5% month-over-month in October, marking the 12th consecutive month of growth. Year-over-year, prices climbed 5.9%, though the pace is slower than earlier in the year.
3. First Year-Over-Year Sales Gain Since 2021
   The National Association of Realtors reported a 3.4% increase in existing-home sales in October, the first year-over-year sales gain since July 2021. This rise reflects a gradual rebound in market activity.
4. Affordability Gains in Key Metro Areas
   In October, affordability improved in all 50 of the nation’s largest metro areas compared to a year ago. Cities like Pittsburgh, St. Louis, and Buffalo saw over 60% of listings deemed affordable for middle-income households.
5. Challenging Affordability in Coastal Markets
   In contrast, affordability remains an issue in California and the Northeast. In Los Angeles, San Diego, and San Jose, fewer than 15% of listings were affordable for middle-income households, emphasizing the regional disparity in housing markets.
6. Buyers and Sellers Re-Engage Post-Election
   According to Redfin, homebuyer demand jumped 17% year-over-year immediately after the election and the Fed’s second rate cut. Pending home sales rose 4.5% during the four weeks ending November 17.
7. Inventory Rises, But Price Cuts Still Common
   Inventory is up 19.1% year-over-year, providing buyers with more options. However, sellers are increasingly reducing prices to attract interest, reflecting cautious buyer behavior in today’s market.

As we close out another month and approach year’s-end, it’s clear the housing market continues to adapt to economic shifts and changing buyer and seller dynamics. Whether you're navigating fluctuating mortgage rates, looking for affordable options, or preparing to sell, staying informed is key. These reports are here to provide you with the latest insights and trends, empowering you to make confident decisions. Whether you’re buying, selling, or simply keeping tabs on the market, understanding the current landscape can help you plan for what’s next.