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Is housing inventory getting better? As of March 2025, the US housing market is undergoing big changes with rising inventory, changing market dynamics and falling home prices. This article dives into those trends, whether the market is for buyers or sellers and what it means for falling home prices.
More Inventory
Over the last year the US housing market has seen a big jump in active listings. According to recent data active inventory is up 27.6% between February 2024 and February 2025, the 69th consecutive week of year over year inventory growth.
– apnews.com
This means more homes for buyers and less urgency of the previous seller dominated markets.
The increase in inventory is partly due to a slow down in buyer activity. Mortgage rates have risen to 6.65% for a 30 year fixed mortgage and that has cooled off buyer enthusiasm.
– apnews.com
This has given inventory time to accumulate and more options for buyers and potentially more negotiating power.
Regional Variations
While the national trend is rising inventory, regional variations still exist. Some markets are still tighter than others with inventory below pre-pandemic levels. For example at the end of February 2025 national active housing inventory was still 23% below February 2019 levels.
These variations are why local market analysis is important for both buyers and sellers.
Market Dynamics: Buyer Friendly
The housing market is shifting towards a buyer’s market. The increase in inventory and the slow down in demand has rebalanced the market power. Homes are taking longer to sell and sellers are pricing more competitively to get buyers. This means it a great time, right now, to apply for a mortgage and start looking for that new home!
This is reflected in several key metrics. The National Association of Realtors reported that the inventory of unsold existing homes grew 3.5% in January 2025 vs the previous month and 16.8% vs January 2024.
– homesforheroes.com
And the months supply of homes—a metric that shows how long it would take to sell all current listings at the current sales pace—has increased indicating a more balanced market.
Home Prices: Stabilization and Decline
After years of rapid appreciation home prices are stabilizing and in some areas declining. The national average home value is $357,138 up 2.6% over the last year.
– zillow.com
But that’s the national average and there are variations by region with some areas seeing price declines due to inventory growth and demand slow down.
For example in areas with high federal employment proposed budget cuts have raised concerns about home price reductions. An analysis found 14 cities where federal employment makes up at least 2% of the workforce and those areas could see bigger home price declines.
– businessinsider.com
These regional differences are why local market analysis is important.
Buyers and Sellers
The changing market conditions have different implications for buyers and sellers:
- Buyers: With more inventory and stabilizing prices buyers can purchase homes without the intense competition of the past. Buyers have more negotiating power and can be more picky. But higher mortgage rates require financial planning.
- Sellers: To attract buyers in this more competitive market sellers need to price right and make sure properties are clean. The traditional spring selling season may still be good but expectations should be tempered compared to the past few years of rapid price growth.
Looking Ahead: Market Outlook
Experts expect the market to stabilize throughout 2025. J.P. Morgan is forecasting 3% or less growth which means the market will be flat.
– jpmorgan.com
This stability will be better for both buyers and sellers as we move away from the volatility of the past.
In summary as of March 2025 the US housing market is seeing rising inventory, a shift to a more balanced or buyer’s market and stabilizing or declining prices in some areas. This means a departure from the seller dominated markets of the recent past and more opportunities for buyers and sellers to be more competitive.
Taking Advantage of More Housing Inventory
With more inventory means more competition. This is a benefit to buyers. This means that it’s a great time to buy if you’re in the market for a new home. If you combine this with the lowering mortgage rates, it makes trying to buy a home a no-brainer. If you’re curious about home getting into a new home, take a couple minutes and talk to licensed mortgage advisor.