10/01/2025 / By Willow Tohi
With the onset of October, real estate professionals nationwide are cautiously optimistic about the fall market. Despite a slight 0.2 percent decline in national home sales in August, the U.S. housing market has shown signs of sustained improvement, with a year-over-year increase of 1.8 percent in sales (sources: National Association of Realtors, 2025).
The inventory of homes for sale has increased by 11.7 percent compared to August 2024, with almost 1.53 million units currently available—marking a considerable stride toward equilibrium in the market (NAR Existing-Home Sales Report, 2025). This growth, while still below pre-2020 levels, signals a more balanced playing field for buyers, who now have more choices and more leverage in negotiations.
After years of relentless growth, home prices are finally stabilizing. The median home price has reached $422,600, a rise of 2.0 percent year over year. But this growth is now tempered, with many markets seeing flat or even slight declines in prices compared to a year ago (NAR Existing-Home Sales Report, 2025). Notably, nearly half of the top 50 metro areas have experienced a 3-4% drop in prices from the previous year, underscoring a cooldown rather than a crash.
While national trends are trending toward balance, regional disparities remain substantial. The Midwest and West, where prices and sales have seen slight upticks, are leading the recovery. In contrast, the Northeast and South have experienced modest declines. Condo markets, particularly in Florida, remain challenged by post-disaster regulations and lingering buyer concerns, a $385,000 median in St. Lucie County exemplifying the sector’s trajectory (Jonathan Lickstein, 2025).
Homebuilders have begun responding to the inventory deficit with an aggressive push toward new construction, a significant factor in improving the market equilibrium. The National Association of Home Builders’ sentiment index, while lukewarm, shows increased optimism about the next six months, driven by anticipated rate reductions and growing buyer traffic (September 2025). For instance, August saw the largest monthly increase in new home sales in the past decade, up 20.5 percent compared to July. This surge is due in part to the variety of incentives builders are offering, such as mortgage rate discounts, closing cost assistance and price reductions (NAR Existing-Home Sales Report, 2025).
As we transition into the fall, the real estate market is poised for a period of gradual improvement. With mortgage rates easing and inventory expanding, conditions are favorable for both buyers and sellers. Lawrence Yun, chief economist at NAR, emphasizes that the market is inching toward a balanced state, with home sales anticipated to improve modestly in the coming months. Careful real estate professionals will position themselves to capitalize on this potential upturn, mindful of the challenges and opportunities that lie ahead.
The real estate market has reached a pivotal moment. While challenges remain—notably in the form of lingering affordability issues and regional variations—the market’s gradual stabilization offers hope. With mortgage rates easing and inventory improving, this fall awaits opportunities for buyers, sellers and professionals alike. Stay attuned to the latest market updates and prepare to navigate the evolving landscape with strategic optimism. We’re on the cusp of a steadier, more sustainable market—one that promises strength and stability as we approach the end of 2025.
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