Homebuyers Regain Confidence as Housing Market Thaws

As of September 5th, 2025, the U.S. real estate market appears to be thawing, offering some relief to homebuyers who have faced soaring prices and high mortgage rates in recent years. According to the latest data, pending home sales, a forward-looking indicator of signed contracts, edged up by 0.7% on an annual basis in July. While month-to-month pending sales did tick 0.4% lower, there are other positive signs.

Mortgage rates, which have remained stubbornly high, are now at their lowest levels since October 2024, currently standing at 6.56%. Additionally, the growth rate of home prices is slowing, and the number of listings on the market has increased, giving buyers a larger inventory to choose from. This could pressure sellers to price their homes more competitively.

Mortgage application volumes have also been on the rise, with purchase application volumes up 2% over the previous week and 25% over the same period last year, according to the Mortgage Bankers Association. This suggests that more serious buyers are returning to the market, potentially encouraged by the recent improvements in market conditions.

However, real estate agents remain cautious, with the National Association of Realtors' confidence index survey finding that only 16% of members expect buyer traffic to improve over the next three months, while 21% expect an increase in seller traffic. As one agent noted, "Even with modest improvements in mortgage rates, housing affordability, and inventory, buyers still remain hesitant."