Monthly Archives: March 2025

The number of homes available for sale hit a historic low a few years ago. Inventory was already lower than normal when the pandemic-era buying boom drove it even lower. That resulted in rising prices and growing home buyer frustration. Fortunately, though, things have improved since then. New home construction ramped up and – particularly in the South and West – has helped home buyers, providing more homes to choose from and smaller price increases. But according to one new analysis, the market still has a long way to go. In fact, the numbers – released by the National Association of Realtors’ consumer website – show the market still short nearly 4 million homes. That’s the third-largest gap since 2012 and one that it would take years to close at the current rate of new home construction. Danielle Hale, the website’s chief economist, says builders made some strides but there’s still work to do. “While builders made strides last year, the scale of the historic housing shortage, paired with strong pent-up demand, meant that new supply couldn’t fully close the nearly 4 million-home gap,” Hale said. (source)

Everyone with a home to sell hopes to get the most money they can for it. That’s why sellers usually make repairs, remove clutter, clean, and get the house ready before listing it. But while prepping the house is important, so is choosing the best time to put it on the market. And, according to one new analysis from the National Association of Realtors’ consumer website, that time is approaching. In fact, based on last year’s trends, homeowners who list their homes between April 13 and April 19 could potentially make an extra $27,000 on their sale. Danielle Hale, the website’s chief economist, says spring is always a good time to sell. “Spring is typically a good time to list your home …,” Hale said. “Very predictably, homes listed in the spring tend to be priced higher and sell faster than the average week throughout the year.” It’s true. Historically, homes actively for sale in mid-April sell about nine days faster than the average week. (source)

According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates fell last week from one week earlier. Rates were down across all loan categories, including 30-year fixed-rate loans with both conforming and jumbo balances, loans backed by the Federal Housing Administration, 15-year fixed-rate loans, and 5/1 ARMs. Joel Kan, MBA’s vice president and deputy chief economist, said it was the sixth straight week rates declined. “Mortgage rates declined for the sixth consecutive week, with the 30-year fixed rate dropping to … the lowest level since October 2024,” Kan said. “As a result, applications increased over the week and were up 31 percent from one year ago.” The MBA’s Market Composite Index – which measures both purchase and refinance demand – saw an 11.2 percent increase week-over-week, with demand for loans to buy homes up 7 percent from the week before. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. (source)

There are a nearly limitless number of reasons you might be thinking about making a move this year. Among that long list, though, age is probably the biggest factor motivating your move. After all, the younger you are, the more likely you are to be changing jobs, getting married, and starting a family – all things that rank high on the list of reasons someone would be looking to buy a home. When you’re older, you’re more likely to have already settled in somewhere and less likely to have a reason to move. Perhaps that explains a new survey of Americans that found the youngest respondents the most likely to say they’re looking to buy. According to the results, 67 percent of Gen Z respondents said they plan to purchase a home this year, compared to 51 percent of Millennials and 49 percent of Gen X participants. On the other end of the spectrum, Baby Boomers were the least likely to say they’re planning to buy at 22 percent. Overall, the survey found 47 respondents are planning to buy this year, with 41 percent saying they believe conditions are favorable for buyers this year. (source)

While you’ve undoubtedly heard talk about “hot” real-estate markets, you may not know what that exactly means. After all, is a market hot because it’s in a desirable location, because its conditions are ripe for buyers, or because competition is high and it’s good for sellers? Well, according to Danielle Hale, chief economist for the National Association of Realtors’ consumer website, hotness is a measure of supply versus demand. “Looking at markets by hotness tells us the strength of demand versus supply in each area relative to others and which markets heavily favor sellers,” Hale said. In other words, a hot market is one where homes sell quickly, list prices are climbing, and price reductions are falling. Hot markets generally see homes selling in fewer than the 66-day national average and garner between two and four times the number of viewers as homes in markets elsewhere. These days, the hottest markets are found in the Northeast and Midwest, where affordable prices and fewer available listings have raised the temperature heading into the spring season. (source)

For most of last year, there was an assumption that mortgage rates were about to fall. And they did, briefly. In late summer, average rates started to decrease and ended their slide in mid-September about a point lower than they were. But unfortunately for prospective home buyers and refi-ready homeowners, lower rates only lasted a week or two before they began climbing back up. Now, according to the latest results from Fannie Mae’s Home Purchase Sentiment Index, Americans have begun to look past an expected rate drop. In fact, the number of respondents who said they expect rates to fall over the next year slipped 5 percent from the month before, while the share who say rates will stay the same is up 3 percent. Mark Palim, Fannie Mae’s senior vice president and chief economist, says Americans are acclimating to elevated rates but it has affected home buying sentiment. “In February, the HPSI saw its first year-over-year decline in nearly two years, which was mostly due to a shrinking share of consumers expressing optimism about the direction of mortgage rates,” Palim said. (source)

The typical monthly mortgage payment applied for by borrowers spiked in January. In fact, according to the Mortgage Bankers Association’s Purchase Applications Payment Index – which tracks payment amounts – the median payment rose to $2,205 from $2,127 the month before. But even after the month-over-month jump, the MBA’s index shows payments just $71 higher than last year at the same time. Edward Seiler, MBA’s associate vice president, housing economics, and executive director, Research Institute for Housing America, says the MBA expects improvement this year, despite affordability challenges. “Home buyer affordability conditions declined further in January as volatile mortgage rates and high home prices continue to impact many prospective buyers’ purchasing power,” Seiler said. “Even with persisting affordability challenges, MBA is forecasting a small increase in purchase originations in 2025, with activity increasing 16 percent to $2.1 trillion.” (source)

According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates fell last week to the lowest level so far this year. Rates were down from one week earlier for 30-year fixed-rate loans with both conforming and jumbo balances, loans backed by the Federal Housing Administration, 15-year fixed-rate loans, and 5/1 ARMs. The improvement helped push demand for home purchase loans 9 percent higher week-over-week. It also drove up refinance activity, which spiked 37 percent higher than the week before. Joel Kan, MBA’s vice president and deputy chief economist, says economic uncertainty has caused rates to decline. “Mortgage rates declined last week on souring consumer sentiment regarding the economy and the increasing uncertainty over the impact of new tariffs levied on imported goods into the U.S.,” Kan said. “Those factors resulted in the largest weekly decline in the 30-year fixed rate since November 2024 … The rate is now at its lowest level since December 2024.” The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. (source)

Housing market conditions are largely determined by the balance of homes for sale and interested home buyers. When demand for homes outpaces the supply of homes, prices and competition increase. That’s been the story in recent years, as inventory hit historic lows while buyer demand soared. But, according to a new analysis from the National Association of Realtors’ consumer website, the dynamic may be changing, and it could benefit buyers. Danielle Hale, the website’s chief economist, says a combination of newly listed homes and home seller price cuts may be a sign. “While rates remain elevated, we are beginning to see green shoots in the market as sellers grow tired of waiting for significant changes in interest and mortgage rates,” Hale said. “If these trends continue for the next few months, we could see a market that is entering into more balanced terrain, with rising inventory and a potential future slowdown in price growth. While the market does not look like it did before the pandemic, we are moving away from the ultrahigh demand, low inventory period we saw in 2021 and 2022.” (source)

The housing market has been through some changes over the past five years. For one, home values have risen 45.3 percent since February 2020. That’s more than 10 years of typical price growth in half the time. Naturally, that’s had big impact on how much house you can buy for your money. Even $1 million doesn’t go as far as it did only a few years ago. So what can you buy for $1 million today? Well, one new analysis looked at the data. It found the typical million-dollar home is about 70 square feet smaller than it was in 2020. They still have four bedrooms and three baths but, at 2,388 square feet, million-dollar homes are smaller. In some locations, significantly so. For example, in Indianapolis, Hartford, and Nashville, the typical million-dollar house is more than 1,000 square feet smaller than it was just five years ago. But while the houses have gotten smaller, the number of them has grown. There are now 989,000 more homes worth $1 million or more than there were before the pandemic. (source)