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1. THE FROZEN HOUSING MARKET (2020–2023)
Inventory and sales hit historic lows due to near-zero mortgage rates.
30-year fixed loans dropped below 3%, some as low as 2.6%.
Demand surged, pushing home prices to record highs.
As rates rose past 7% in 2023 (highest since pre-2008), buyer affordability plummeted.
Despite falling demand, prices stayed high due to sellers clinging to low-rate mortgages (“golden handcuffs”).
2. THE HOUSING STANDOFF (2024)
Buyers waited for a correction, sellers refused to list.
Result: prices stayed flat or even rose in supply-constrained areas.
Inventory increased significantly in some metros (e.g., Tampa, North Port).
Others, like NYC, Chicago, and Cleveland, still saw price growth (6–8%).
3. THE HOUSING STAGNATION (2025)
Price growth slowed to just 3–4% annually.
Spring 2025 marked the 11th straight month of slowing gains.
March price growth neared 0%—a sign that buyers may regain leverage.
Mortgage Rates: Hovering at ~7%, doubling monthly payments vs. 2020.
Demand: Pending sales down 1.7% YoY; cancellations rising to 14%.
Inventory: Listings up nearly 30% YoY—over 1M homes now for sale.
Why Inventory Is Rising:
Life events force moves despite low rates.
Homeowners sitting on large equity cushions.
Fears of declining prices prompt preemptive selling.
Investors shifting capital elsewhere.
Current Market Conditions:
Homes now sit ~50 days on market (vs. 33 in 2021).
Only 28% of homes sell above list (was 50%+ in 2021).
31 of the top 50 metros are now buyer’s markets.
Most extreme example: Miami — 3 sellers for every 1 buyer.
5. THE CONDO COLLAPSE
Condos now have 83% more listings than offers.
Condo prices up only 0.4% YoY vs. 1.5% for single-family homes.
Key issues: rising HOA fees, insurance costs, and investor sell-offs.
Why Condos Underperform:
HOA fees up 32% (2005–2015), higher maintenance, and insurance costs.
Prices drop faster during downturns.
Stricter lending rules due to perceived risk.
More usage restrictions and less flexibility vs. single-family homes.
6. THE HARDEST HIT MARKETS:
National median prices up only 1.9%—below inflation, meaning real decline.
Biggest YoY drops: Oakland (-4.9%), Dallas (-4.5%), Jacksonville (-3%), Austin (-2.5%), Seattle (-1.5%), Denver (-1%).
From 2022 peaks: Austin (-21%), Oakland (-19%), SF & New Orleans also down double digits.
Median list price up only 0.2% YoY—sellers are no longer pushing prices.
Home Builders’ Strategy:
Instead of lowering prices, builders “buy down” buyers’ mortgage rates.
This keeps sale prices high while giving buyers lower monthly payments.
Helps preserve property values without visible price cuts.
7. MY THOUGHTS:
If you’re in the market for a home, this might be the first time since 2020 where you can afford to be selective, you can chose to negotiate, or you could walk away to try to find a better deal – without worrying about the market marching higher.
For everyone else who’s simply watching home prices out of curiosity: honestly, you probably won’t feel much of an impact, and any headline drops in price seem to be moderate, at best (it’s not like national home prices will dip 10-20% anytime soon outside of a few localized markets). instead, we might see more of a flatlining of prices for the near future – or, some very modest gains – if anything.
That’s why – I think, if you NEED to buy a home, find one that fits your budget, on a fixed rate loan that you can afford, and only on something that you intend on keeping for at least 7-10 years – IF you can’t rent an identical home for significantly cheaper.
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*Some of the links and other products that appear on this video are from companies which Graham Stephan will earn an affiliate commission or referral bonus. Graham Stephan is part of an affiliate network and receives compensation for sending traffic to partner sites. The content in this video is accurate as of the posting date. Some of the offers mentioned may no longer be available. This is not investment advice.
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