As the calendar flipped to 2025, the U.S. real estate market saw a notable shift with an 8% increase in new home listings compared to the same period last year. This rise offers potential buyers a broader selection as they navigate persistently high mortgage rates.
The real estate landscape at the close of 2024 was marked by a slight decrease in pending home sales, coinciding with mortgage rates hovering around 7%. Specifically, the daily average 30-year fixed mortgage rate was at 7.07% on January 2, slightly down from 7.14% recorded two weeks prior, yet it marked an increase from 6.7% a year earlier, according to Mortgage News Daily. Meanwhile, Freddie Mac reported a weekly average of 6.91% for the same mortgage type, reaching its highest level since July.
Interestingly, mortgage-purchase applications saw a reduction of 13% from two weeks earlier, a more pronounced decrease of 17% year-over-year as indicated by the Mortgage Bankers Association. Concurrently, the Redfin Homebuyer Demand Index showed minimal change from the previous month but experienced a slight 1% drop compared to the prior year. This index measures the frequency of home tours and other purchasing services facilitated by agents.
Touring activity decreased sharply by 52% from the start of the year as of December 28, noted by ShowingTime, underscoring a trend where the previous year had already seen a 55% reduction. However, Google searches for ‘home for sale’ increased by 30% from the preceding month, although they were down 4% year-over-year, reflecting an ongoing but cautious interest among potential buyers.
The housing market data from 400+ U.S. metro areas encapsulated several changes over the four weeks ending December 29, 2024. The median sale price climbed to $383,750, representing a 6.4% increase, the most significant since October 2022. Likewise, the median asking price rose by 5.6% to $373,500. The median monthly mortgage payment reached $2,515 at a 6.91% mortgage rate, climbing 8.1%.
Pending sales totaled 54,357, marking a slight 1.1% decrease, whereas new listings jumped to 48,705, up by 7.7%. Active listings expanded by 9.7% to 905,822, increasing inventory availability. Months of supply stood at 4.2, up by 0.5 points, suggesting a shift closer to a balanced market. Homes selling above list price decreased to 22.9%, while the average sale-to-list price ratio edged down to 98.3%.
Regionally, significant median sale price increases were observed in Milwaukee (17.4%), Cleveland (14.3%), and Philadelphia (13.5%). On the other hand, pending sales surged in Detroit by 11.9%, and Anaheim, CA, by 10.4%. New listings dramatically rose in San Francisco by 48% alongside increases in Oakland, CA (36.6%), and Seattle (21.6%). However, new listings declined in San Antonio by 12.7%, Detroit by 9.5%, and Austin, TX, by 8.4%.
The analysis of these statistics indicates varying market conditions across different metropolitan areas, yet a prevailing trend of increased housing supply is evident. The data demonstrates notable regional variations in both listing behavior and pricing trends, highlighting the nuanced nature of the current housing market.
The current U.S. real estate market showcases both challenges and opportunities for buyers and sellers alike. While mortgage rates persist near 7%, the rise in new listings provides a glimmer of hope for those seeking to purchase. With regional variations influencing market dynamics significantly, potential buyers should consider local conditions alongside national trends as they make informed decisions in 2025.
Source: Redfin
