T
he US housing market is entering the second half of 2025 with a mix of positive and negative trends. While rising inventory and slowing price growth offer some relief to buyers, high home prices, property taxes, and borrowing costs continue to limit affordability. Mortgage performance remains stable overall, but regional disparities and shifting buyer behavior hint at deeper structural changes ahead.
Here are the key takeaways from Cotality's midyear market analysis:
1. Pending sales rose 10% year-over-year in May 2025, but closed sales dropped 14%, highlighting financial headwinds for buyers.
2. Listing prices increased 5% to $495,000, while median sale prices remained flat at $450,000, widening the gap between asking and closing prices.
3. Single-family rents grew 2.9% year-over-year in April, with steepest increases in the Northeast, Midwest, and Mid-Atlantic regions.
4. Investors accounted for 30% of single-family purchases in 2025, largely due to their ability to pay all-cash, shielding them from high borrowing costs.
5. Cash sales dropped to 36% of home sales in the first five months of 2025, but remain elevated, driven by investor activity.
6. Total mortgage delinquencies fell to 2.8% in April 2025, with serious delinquencies declining to 0.9%.
7. FHA loans showed greater distress than other mortgage types, suggesting lower-income or first-time buyers are disproportionately affected by current financial conditions.
8. States with the highest serious delinquency rates include Louisiana, Mississippi, New York, and Florida, with the South and East experiencing more mortgage stress.
9. Homeowners have $11 trillion in untapped equity, but few are choosing cash-out refinances due to high interest rates.
10. Average homeowner equity fell by $4,000 nationwide between Q1 2024 and Q1 2025, with steeper declines in Florida and Texas.
The housing market in 2025 is a paradox: inventory is up, mortgage delinquencies are down, yet affordability remains out of reach for many due to price and rate pressures. The second half of the year may hinge on whether interest rates finally begin to ease.
