But the housing market is still struggling to find its feet in 2025, with no sign that mortgage rates are set for a pronounced drop anytime soon and economic uncertainty continuing to cloud the outlook. Kushi highlighted that July sales were 8% lower compared with the same time last year, while inventory remains well above pre-pandemic averages.
What’s more, the sluggish pace of sales could also suggest that incentives aimed at boosting homebuilding aren’t proving as effective as first hoped.
“Builders have relied heavily on incentives, such as mortgage rate buydowns, upgrades, and even price reductions, to support demand and maintain an edge over the existing-home market,” Kushi wrote.
“However, the recent pattern of sales – holding at relatively subdued levels – suggests these measures are becoming less effective amid strained affordability, rising resale inventory, and macroeconomic uncertainty.”
July sales fell in the South and Midwest, but rose by 11.7% in the West. Meanwhile, the median sales price of a home fell by nearly 6% year over year, slipping to $403,800 amid a wider market slowdown.