"US Housing Market Thaws Gradually: Glimmers of Optimism Amid Affordability Challenges" cover art

"US Housing Market Thaws Gradually: Glimmers of Optimism Amid Affordability Challenges"

"US Housing Market Thaws Gradually: Glimmers of Optimism Amid Affordability Challenges"

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 In the past 48 hours, the US housing industry has shown signs that a long period of stagnation is slowly giving way to cautious movement, although activity remains near historic lows. Recent data from Redfin shows that only 28 out of every 1,000 US homes changed hands during the first nine months of 2025, marking the slowest turnover rate since the early 1990s. Texas metros have seen some of the steepest declines in home sales, with San Antonio experiencing a 27 percent drop from last year. Most homeowners are ‘locked in’ by mortgage rates well below the current average of around 6.2 percent, making them reluctant to sell and dampening supply despite pent-up demand[2].

While affordability remains a major barrier, there are pockets of increased buyer leverage. Buyers are more likely to walk away from deals or demand concessions, and sellers are being pushed to lower expectations. Nationwide, however, the National Association of Realtors reported a small 1.5 percent bump in existing home sales in September, the fastest since February, and a record-high September median price of 415,200 dollars, suggesting persistent upward pressure on prices despite sluggish turnover[2].

Housing market leaders are responding with a mix of caution and optimism. In markets like San Francisco, the rise of artificial intelligence companies has brought affluent buyers and driven homes to sell faster than at any point since 2021, with the median San Francisco home selling in just three weeks compared to a national average of 51 days[5]. Goldman Sachs projects a 4.5 percent increase in US home prices for 2025, fueled by anticipated Fed rate cuts, which could gradually lower mortgage rates and unlock more buying power[1]. Mortgage applications have seen a 25 percent year-over-year increase in the latest week, as rates briefly retreated to 6.72 percent[6].

Inventories are recovering somewhat, with active listings returning to pre-pandemic levels in some regions, and states like Tennessee and Texas seeing notable rises in both resale and new construction homes, although many remain priced above what most buyers can afford[3]. Experts predict gradual improvement as mortgage rates continue their measured descent toward 5.9 to 6.2 percent over the next year, potentially easing access for new buyers[7].

Overall, there is no major disruption from regulation or product launches this week, but shifts in consumer caution and slow movement in both inventory and prices point to a market recalibrating for sustainable growth rather than another boom or bust cycle. Compared to previous periods of deep freeze, the industry appears to be thawing, especially in select high-growth metros, yet most of the country is still waiting for affordability and confidence to return.

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