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s June 2025 begins its second week, the US housing market continues to send mixed signals. Mortgage rates have declined modestly, but buyer demand remains sluggish. Nationwide inventory is rising, potentially foreshadowing a cooler summer.
Mortgage rates snapshot: Current trends
The average 30-year fixed mortgage rate ended the week at 6.94%, down from 7.01% at the start of the week. The lowest point came Thursday, when rates dipped to 6.87%. Despite this drop, affordability remains a challenge due to elevated home prices in many areas.
Buyer demand cools, inventory climbs
Across the country, buyer activity has dropped significantly, with purchase applications down 39% compared to 2019. Refinancing is also down nearly 80% from three years ago. Meanwhile, listings are rising: national inventory is up 20.8% year-over-year, though still below 2019 levels.
Price cuts and incentives become more common
As the buyer-seller gap widens, sellers are offering incentives to attract hesitant buyers. Price cuts are becoming more prevalent, particularly in overbuilt metros. Some sellers are delisting homes entirely and choosing to rent them out instead, further distorting supply metrics.
Regional trends: Where prices are rising (and falling)
The US housing market is fragmenting into two camps: appreciating and depreciating metros. Markets with year-over-year price growth include Miami, FL (+9.4%), Austin, TX (+7.2%), and Charlotte, NC (+6.8%). In contrast, markets with year-over-year price declines include Boise, ID (-3.1%), Phoenix, AZ (-2.4%), and Las Vegas, NV (-1.2%).
New construction trends
Homebuilders are adjusting to the market by focusing on smaller, more affordable homes. Builder incentives are common in newer subdivisions, ranging from below-market mortgage rates to bonus amenities.
What to expect next week
With the Fed's next policy meeting approaching and inflation data due out mid-June, volatility is likely to continue. Analysts predict rates could trend down modestly if inflation cools further. Buyers may re-enter the market after July 4, historically one of the busiest periods for summer real estate activity.
