The housing market is in an interesting place right now. On one hand, buyers finally have more homes to choose from and slightly better affordability than in recent years. On the other hand, many are still hitting the pause button before committing to a contract.
According to the National Association of REALTORS® (NAR), pending home sales—an indicator based on contract signings—remained flat in July, dipping just 0.4% from June. Compared to last year, they were up a modest 0.7%.
Why the Hesitation?
Even with mortgage rates easing a bit and the largest housing inventory since 2020, buyers remain cautious. Lawrence Yun, NAR’s chief economist, explains:
“Buying a home is often the most expensive purchase people will make in their lives. This means going under contract is not a decision made quickly. People are taking their time to ensure the timing and the home are right for them.”
That said, mortgage applications are climbing—up double digits compared to a year ago. This signals more buyers are keeping a close eye on the market, even if they haven’t yet made their move. And with the Federal Reserve hinting at potential rate cuts, buyer confidence could strengthen in the coming months.
A Window of Opportunity?
Here’s the silver lining: buyers may have more negotiating power now than at any point in the last five years. Wage growth is currently outpacing home price growth, and nearly half the country is seeing price reductions. Existing-home sales also showed a slight boost in July, up 2% from the month prior.
In other words, conditions are quietly shifting in buyers’ favor—even if many haven’t realized it yet.
Regional Market Snapshot (July 2025)
Northeast: Down 0.6% from June, and also 0.6% lower than last year.
Midwest: Contract signings fell 4% from June, but are still up 1.3% year-over-year.
South: Essentially flat month-over-month (-0.1%), but 1.8% higher than July 2024.
West: The standout performer—up 3.7% month-over-month, though still 1.9% below last year.
What This Means for You
If you’ve been waiting on the sidelines, this could be the moment to start exploring your options. More inventory, moderating rates, and increasing price flexibility all point to greater opportunities for buyers who are ready to make their move.
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