What's Happening in the Housing Market This Month?

Do you feel like you're constantly being told the housing market is in trouble? With daily headlines about tariffs, mortgage rates near 7%, and fears of economic downturns, it's easy to become overwhelmed and uncertain. During Nuvision Credit Union’s recent 2025 Economic Forecast Webinar, economist Dr. Christopher Thornberg reminded members that "the biggest problem with the economy right now is the stories we tell ourselves about it." Negative headlines often overshadow the actual data, creating unnecessary fear.

At Nuvision, we're committed to cutting through these conflicting narratives by providing clear, straightforward insights. Here’s what's really happening, based on the latest data from Zillow, Redfin, the National Association of Realtors (NAR), and housing expert Steven Thomas.

Zillow: Buyers Cautious, Sellers Optimistic

Zillow reports buyers are still cautious due to economic uncertainty, despite mortgage payments dropping by about 1.3% compared to last year. Newly pending home sales were down 2.5% from a year ago, indicating that many potential buyers are still waiting to see how things unfold. On the other hand, sellers seem more confident, listing 7.6% more homes compared to last year, which has pushed inventory levels up to the highest they've been since August 2020. Almost 25% of sellers have cut prices to attract buyers.

Competition varies across regions—it's intense in the Northeast and on the West Coast, while the South is experiencing less pressure, giving buyers more negotiating power. Zillow also predicts a slight national price drop of about 0.9% over the next year, marking the first expected annual decline since 2011.

Redfin: Prices Cool Slightly, Supply Grows

Redfin also notes the market cooling off, with home prices dropping by 0.1% in April, the first monthly decline since 2022. Annual price growth has slowed significantly to 4.1%. Supply has risen to a five-year high, even as existing home sales reached their lowest point in six months. Buyers continue to face high mortgage rates near 7%, keeping many cautious.

Homes are staying on the market longer—around 40 days on average—giving buyers room to negotiate prices down. Price declines were recorded in half of the top U.S. metropolitan areas.

National Association of Realtors: Affordability Still a Major Issue

The NAR underscores ongoing affordability issues, despite almost a 20% increase in homes for sale compared to last year. Households earning around $75,000 annually can still afford only about 21% of available listings. To achieve a balanced market, hundreds of thousands of additional homes priced under $340,000 are needed. However, certain areas are showing positive signs, with improved affordability in several markets, particularly in the Midwest and South.

Nationally, home prices rose in more than 80% of metro areas, with the median price climbing 3.4% to just over $402,000. However, affordability continues to be a significant hurdle.

Steven Thomas: Why Homeowners Remain Cautious

Housing market expert Steven Thomas explains that fewer homeowners are listing their homes because of lingering fears from the Great Recession. With higher mortgage rates adding to their reluctance, homeowners are choosing to stay put longer, leading to significantly fewer home sales. Residential resale numbers have dropped about 38% compared to pre-recession years, tightening the market despite recent increases in listings.

Five Key Takeaways for Members:

1. Inventory is Rising: Nationally, inventory levels are at their highest level since August 2020, offering buyers more options.

2. Prices Moderating: Home prices saw their first monthly decline since 2022, signaling potential easing for buyers.

3. Affordability Challenges: Households earning about $75,000 annually still face significant hurdles, as they are able to afford only around 21% of listings.

4. Mortgage Rates Still High: Mortgage rates remain near 7%, contributing to buyer caution and slower home sales.

5. Longer Market Times: Homes are now staying on the market longer, averaging around 40 days, giving buyers more negotiating leverage.

At Nuvision, we've been building trust for 90 years by giving our members a level of care and confidence they won't find at other financial institutions. We share these insights because we want you to see beyond the headlines, helping you make decisions based on facts, not fears. We care about your financial future, and we're here whenever you need us.