The US housing industry has shown increased activity in the past two days, driven by a modest drop in mortgage rates and notable price adjustments by sellers. As of late November 2025, the average fixed rate on a 30-year mortgage sits at approximately 6.2 percent, marking its lowest point in over a year. This decrease has led to a slight boost in both inventory and pending home sales, each rising 5 percent in October according to Zillow data. The improvement in affordability comes at a time when wage growth continues to outpace the increase in housing costs, offering buyers a marginal relief compared to previous months.
Home price reductions have been especially prominent this fall. Zillow reports that 26.9 percent of listings in October experienced a price cut, with the median cumulative reduction at $25,000—the largest discounts the company has ever recorded. In major metros like Los Angeles, typical listing reductions reached $61,000, though cities such as Oklahoma City and Louisville saw more modest cuts of about $15,000. Despite these discounts, overall home prices in many regions remain elevated, with the median price of a single-family home around $421,000, significantly higher than the $283,000 median seen in January 2020.
Recent market movements reflect a stabilization in price declines across metro areas. Out of the nation's 300 largest housing markets, 105 saw year-over-year home price drops in October, but this number has stopped increasing as inventory growth stalled. Roughly 35 percent of major markets—especially in the Sun Belt and Mountain West—face mild pullbacks, while the Northeast and Midwest maintain growth thanks to tighter inventories. Furthermore, the lock-in effect, where homeowners hold on to low-rate mortgages, continues to limit listings, though existing home inventory has risen about 30 percent year-over-year.
First-time buyers now make up only 21 percent of total sales, the lowest share in over four decades. Cash buyers represent 26 percent of transactions, signaling ongoing affordability barriers and a challenging landscape for new entrants. In response, industry leaders are focusing on rental markets and launching promotions to attract buyers, while homebuilders increasingly offer incentives and price cuts in oversupplied regions.
In summary, the US housing industry is in a period of transition, seeing localized price cuts and slight boosts in affordability, but still facing substantial obstacles for prospective buyers. Compared to last year, market conditions are slowly improving, but remain subdued relative to pre-pandemic norms, with regional disparities and cautious optimism defining the current climate.
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