Overview
Signals that there is now a transition from a seller's market to a buyer's market are appearing. Buyers should pay close attention to the relationship between inventory and price declines. More homes offer more choice and bargaining power, a dynamic not seen since prior to the pandemic.
Housing stock is rising. Prices are softening. But buyers aren’t biting, even though they hold more power than they’ve had in years.
In May, the national median list price held at $495,000, while mortgage rates hovered near 7%. Cotality data shows closed sales were down 15% year-over-year, despite a 10% rise in pending deals.
The result is a stalemate: plenty to choose from, little being chosen.
Supply swells
The number of homes for sale is increasing nationwide. Toledo, Ohio saw for-sale homes shoot up 128%. Savannah, Georgia recorded a 108% rise. Many areas of Florida saw inventory build up over 50%.
But these homes stay on the market longer. Since last year, the number of days that homes linger on the market rose by double digits. More choice with less time pressure has increased the number of pending deals. However, these deals aren’t closing.
Sellers are betting on more favorable selling conditions in the future and are taking homes off the market. Delistings hit the highest levels since May 2011. There are also 3% fewer listings than last year.
While many buyers want to make a deal, a disconnect remains. Price has become a sticking point.
Pinched by price
Homebuyers need an additional $200,000 compared to 10 years ago to close on a median-priced home, Cotality data found. That’s a sharp jump, especially for first-time buyers and renters faced with rents that cost 3.1% more year over year. That makes saving for a downpayment slower and harder.
Slow savings rates also affect sellers. Many sellers are dropping prices in response to a slow market. In May, about 56% of listings sold below the asking price, which is still well above what’s been recorded in the last five years.
Such price concessions are easier for big builders to stomach. Homeowners, however, feel the squeeze from a $45,000 difference between May’s median list price and close price. As a result, many individuals hold out for better offers, which is leading to rising inventories.
Mapping markets
Markets in Texas and Florida have seen some of the largest year-over-year increases in inventory. Cities in Florida, such as Naples and Cape Coral, saw active inventories jump 58% and 55%, respectively. These two metro areas also top the charts for price decline risk, according to Cotality.
Los Angeles and Washington D.C. are two other major metros where more homes now sell below asking price. While the declines in these coastal metros are not enough to pull them into the range of affordability — median prices remain at $925,000 and $630,000, respectively — this trend is a rare opportunity for buyers.
Data source: Cotality, 2025
Cotality’s senior economist Daniel Boswell says today’s tilt primarily helps households with cash to spare. While there are pockets of affordability around the country, high mortgage rates and rising insurance premiums still block most families.
“Savvy buyers are now in a market that is primed for negotiations on price reduction, closing cost assistance, and mortgage rate buydowns,” says Cotality senior economist Daniel Boswell. “However, the tilt toward a buyers’ market is only a bright spot for those who have the means to make a move. For many, systemic hurdles such as interest rates and rising insurance costs remain a barrier to homeownership.”
Unsticking the future
For years, the market has been stuck. Owners have stayed put, protected by low interest rates while building home equity. Meanwhile, appreciating prices have barred new entrants. That stalemate is starting to thaw.
New jobs. Growing families. Retirement. Life changes, and it’s beginning to propel homeowners and homebuyers to move. While buyers now have a better chance for bargains, hurdles remain.
Cotality experts don’t expect a price dip. Instead, Cotality’s Home Price Index forecasts a 4.2% rise by June 2026 while interest rates hold steady. Even in a market ripe to favor buyer negotiations, these external factors may constrain buyers and sellers, weakening the future of the property market.
Inventories may rise, but affordability still falls. Until one yields, the stalemate lingers.
