- The number of active listings reached 18,310, marking the highest level of inventory since September 2018
- The number of closed sales decreased by 3.3% year-over-year
- For every listing “Sold” last month, seven (7) new listings took its place.
- Relative to the previous month, the number of active listings increased by 3,851 (from 14,459 in April 2025), while the number of closed sales increased by only 580.
- Mortgage demand drops, even as rates fall to the lowest since April
Bye-bye bidding wars:
Home sellers this spring have been frustrated by a slower-than-normal housing market. That could set up a summer of deals for buyers. That means house hunters this year could end up seeing the “most buyer-friendly summer” in seven years.
However, the real estate market continued to experience significant growth in housing inventory across NWMLS’s coverage area. While buyer activity showed some signs of seasonal strength, it continued to lag behind the surge in new and active listings. Buyers may be slow to accepting what may be a new normal, with mortgage rates continuing to hover close to 7% and construction costs hampering new developments.
Weak consumer sentiment is weighing hard on the housing market, as potential homebuyers pull back.
Applications for a mortgage to purchase a home fell 3% last week compared with the previous week, according to the Mortgage Bankers Association's seasonally adjusted index. Volume was still 14% higher than the same week one year ago.
- The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances, $806,500 or less, decreased to 6.84% from 6.93% last week.
- Mortgage demand from homebuyers fell 3%
- Demand to refinance a home loan dropped 2%
The typical home for sale remained on the market for 38 days this May, six days longer than in May 2024, according to real-estate brokerage Redfin.
Redfin also reports that Seattle leads all major U.S. metropolitan areas in concessions for home buyers as the trend continues to escalate nationally.
Home sellers gave concessions to buyers in a whopping 71.3% of transactions during the first quarter of 2025, nearly double the mark from a year ago. In 2024, just 36.4% of house real estate transactions included concessions. Not only does Seattle lead all metro regions in 2025, it’s also the largest year-over-year increase among the metros Redfin analyzed.
A lot of really beautiful homes are just sitting, with so much inventory and competition. We have been low on inventory for nearly 6 years now, so this is a new dynamic for many buyers and seller alike.
Thinking of Selling Your Home?
Is now a good time to buy a home?
In a Fannie Mae survey conducted in May, a greater share of Americans than in previous months said it was a good time to buy a home. Even though the majority of respondents said that it was a bad time to buy, the share of people who flipped to thinking it was a good time rose to the highest share in three years.
In a report from MarketWatch, most of the real-estate agents MarketWatch spoke with were happy about the shift toward a buyer-friendly market. During the pandemic buying frenzy, housing inventory in Seattle all but dried up resulting in unsustainable bidding wars and price escalations. Now the market has 2.8-month inventory in May, up from just 1.6 months of inventory a year prior.
This is way more healthy for everyone involved.
A slower market has also given buyers the luxury of time. Since they can be fairly confident a home won’t sell in 24 hours, a buyer can see the home more than once and take their time deciding if it’s worth buying. They don’t need to waive the appraisal, so they get a fair assessment of the home’s price, and they also don’t have to skip a home inspection. Passing on home appraisals and inspections was more common during the pandemic.
Can more inventory revive a depressed housing market?
The question now is this: What will bring home sales out of their funk?
Over the last three years, politicians from both sides of the aisle have singled out increased housing inventory for both owners and renters as the antidote to longstanding concerns over housing affordability. It became a rallying cry as home sales fell to the lowest point in 30 years, driven by a severe lack of inventory coming out of the pandemic.
But as listings pile up, it’s clear that inventory is only one factor in the housing market’s woes. Even though active inventory was up in early June by about 28% year over year, home sales are still low.
The real-estate industry has now pivoted to casting high mortgage rates as the villain. “It is all about mortgage rates,” Lawrence Yun, chief economist at the National Association of Realtors, said in May.
“Despite an increase in housing inventory, we are not seeing higher home sales,” Yun said. “Lower mortgage rates are essential to bring home buyers back into the housing market.”
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Posted by Cary W Porter on
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