What's happened
US existing home sales remained flat at 4.06 million in 2025, the same as 2024, which saw the lowest sales since 1995. Prices rose slightly, but affordability and economic uncertainty continue to limit buyer activity. December saw a brief sales uptick due to lower mortgage rates.
What's behind the headline?
The US housing market's stagnation in 2025 underscores persistent affordability issues despite some easing in mortgage rates. The flat sales volume indicates that price growth alone isn't enough to stimulate activity. The December uptick suggests that lower mortgage rates temporarily boost sales, but structural barriers like high prices and economic uncertainty will likely keep the market subdued. This stability at a low level signals a prolonged period of sluggish activity, with potential for modest growth if economic conditions improve. The market's resilience, despite these headwinds, hints at underlying demand, but buyers remain cautious, especially first-timers without equity. The recent rate decline may be a short-term catalyst, but without sustained economic growth and wage increases, the market will struggle to return to pre-pandemic sales levels. Overall, the outlook suggests a cautious, slow recovery rather than a rebound.
What the papers say
The articles from NY Post, The Independent, and AP News all confirm that US home sales have remained stagnant at around 4 million annually since 2023, well below the historical norm of 5.2 million. They highlight that despite a recent decline in mortgage rates to near 6%, affordability remains a barrier, especially for first-time buyers. The articles also note that December's sales increase was driven by lower mortgage rates, but economic uncertainty continues to suppress broader activity. The NY Post emphasizes that sales have declined annually since 2022, while The Independent and AP News focus on the persistent low sales volume and rising prices. The consensus is that the market is in a prolonged slump, with only temporary improvements linked to rate fluctuations.
How we got here
The US housing market has been in a slump since 2022, driven by rising mortgage rates from pandemic lows. Despite recent declines in mortgage rates, affordability remains a challenge, especially for first-time buyers. The market's slow recovery reflects broader economic and job market uncertainties.
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