The US housing market is enduring a ‘cruel summer’ — leaving buyers, sellers, and builders equally frustrated.
High prices and soaring mortgage rates are forcing many would-be buyers to remain on the sidelines.
Meanwhile, sellers are deciding they would rather delist their home entirely than budge on the price that they have in mind.
Homebuilders are feeling the pinch too, slowing construction as the market stalls.
‘It’s the Anna Karenina housing market: Everyone is unhappy, but each in their own way,’ said Realtor.com senior economist Jake Krimmel.
In other words, buyers, sellers, and builders each face unique challenges, yet the result is widespread dissatisfaction across the market.
As a result, the market is in stasis and ‘grinding through a cruel summer,’ Kimmel said.
‘Buyers face steep affordability barriers. Sellers are losing market power but are futilely resisting. And builders are now pulling back even as the nation remains short of four million homes. And regional markets are dysfunctional in their own unique ways.’
The US housing market is suffering through a ‘cruel summer’ which is leaving buyers and sellers united in their frustration
‘It’s the Anna Karenina housing market: Everyone is unhappy, but each in their own way,’ said Realtor.com senior economist Jake Krimmel
Prospective buyers have found themselves facing major affordability headwinds this summer, which is keeping them from making major moves.
The national median list price remains near $440,000, which is relatively unchanged since 2022, according to Realtor.com.
However mortgage rates have climbed, pushing monthly payments significantly higher. Compared to 2019, today’s buyers are paying over $1,200 more per month for the average home, with costs rising due to both price growth and higher interest rates.
Even in markets where prices have fallen, which are mostly concentrated in the South and West, the ‘double whammy’ of high rates and residual price appreciation has sidelined many Americans.
This means that home sales remain near multi-decade lows, despite 21 consecutive months of rising inventory.
Meanwhile, stubborn sellers remain reluctant to lower their prices — choosing to delist their homes instead.
‘It’s a way for sellers to reassert control in a market where their leverage is fading,’ said Krimmel.
Across the US in June, for every 100 new listings, 21 were removed without a sale.
The national median list price remains near $440,000, which is unaffordable for many Americans
Even where home prices have fallen, Americans are facing a whole host of issues (Pictured: Miami, Florida)
The pandemic-era property boom is beginning to level out in cities such as Austin, Texas
In some places the level was even higher. In Miami, for example, the delisting ratio was 59 per 100 new listings.
The trend is yet another sign that Miami’s housing market — which has encountered insurance issues, cooling demand, and a shortage of affordable housing — is in the middle of a downturn.
The resistance of sellers to adjust their prices is also contributing to stalled transactions and keeping prices elevated, which is further compounding affordability issues across the market, according to Realtor.com.
Disillusioned builders are also pulling back as the summer market remains stagnant, despite the fact the US is still short an estimated 4 million homes.
Single-family home construction is down, permits are falling, and the pipeline of new builds is shrinking.
Factors like high financing costs, weak buyer demand, and new tariffs on building materials have made developers increasingly cautious.
Adding to the complexity is a stark regional divide.
In the South and West, supply is massively outpacing demand, leading to slower sales and price drops.
Meanwhile, in the Northeast and Midwest, the situation is almost the exact opposite. Inventories are low and demand is high, which is keeping prices up.
‘In this case, you really need the trees to see the forest,’ said Krimmel.
‘Looking to the future, jumpstarting the housing market nationally may actually require different antidotes depending on the region.’