Buyer Shortage Disrupts U.S. Housing Market Stability/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ The U.S. housing market is facing an imbalance with 34% more sellers than buyers in April 2025. Elevated mortgage rates and historically high home prices are sidelining prospective homebuyers. This trend is shifting market power toward buyers, but affordability remains a key challenge.
Housing Market Imbalance: Quick Looks
- Buyer-seller gap widens: 1.9M sellers vs. 1.5M buyers in April 2025
- Mortgage rates near 7%, discouraging many would-be buyers
- 1 in 5 homes had price cuts as sellers try to attract offers
- Home sales fell to 2009 levels, despite higher inventory
- Redfin predicts a 1% price drop by year’s end in some markets
- Miami sees worst imbalance, while Newark remains a seller’s market
- Affordability crisis persists: Only 21.2% of homes deemed affordable
- Wages lag far behind prices, which have jumped 53% since 2019
Deep Look: U.S. Housing Market Tilts Toward Sellers as Affordability Crisis Grows
LOS ANGELES — As of April 2025, the U.S. housing market has officially entered a phase where sellers outnumber buyers by more than one-third, marking one of the widest gaps in over a decade. According to a new Redfin analysis, this imbalance is the sharpest since April 2020, when COVID-19 halted economic activity altogether.
With mortgage rates hovering near 7% and home prices still climbing, the number of prospective homebuyers has plummeted, pushing many Americans out of the market entirely. The April data showed nearly 1.9 million active sellers and 1.5 million interested buyers, representing a shortfall of more than 490,000 buyers.
This shift marks a dramatic reversal from just a few years ago, when bidding wars were common and homes often sold for far above asking prices. Today, that urgency has cooled.
“The balance of power has shifted toward buyers,” said Asad Khan, Redfin senior economist. “But a lot of sellers haven’t adjusted their expectations.”
Sellers Face Tougher Conditions
While home prices are still high, the lack of buyers is forcing more sellers to lower asking prices or offer incentives like covering closing costs. Realtor.com reported that nearly 20% of all home listings in April saw price reductions.
And even though inventory of previously owned homes has risen to its highest level since September 2020, it’s still well below pre-pandemic norms, especially for affordable housing segments.
High Rates, High Prices Block Buyers
The downturn in buyer activity began in late 2023, when mortgage rates climbed to nearly 8%—a 23-year high. Though rates have eased slightly to 6.89% this week, they remain high enough to deter many first-time buyers and middle-income earners.
This combination of high rates and high prices means affordability has cratered. According to the National Association of Realtors (NAR), only 21.2% of listed homes were affordable to a household earning $75,000 annually. Before the pandemic, that same income bracket could afford almost 50% of available homes.
“Without a significant boost in housing inventory below $260,000, homeownership will remain out of reach for millions,” the NAR stated.
Metro Markets Diverge Sharply
Some major markets are already showing signs of softening:
- Miami: Sellers outnumber buyers 3-to-1, the widest gap nationally
- Dallas, Oakland, and Jacksonville: Notable price drops reported
- Newark, NJ: The only large metro where buyers still outnumber sellers
In total, 11 of the 50 largest U.S. metros recorded home price declines during the four weeks ending April 20.
The Broader Economic Impact
The buyer-seller mismatch is also dragging down overall housing activity:
- April home sales hit their lowest pace for that month since 2009
- 2024 saw the fewest total home sales in nearly three decades
- Sellers reluctant to reduce prices may see their listings sit longer
- Builders are cautious as buyer demand remains shaky
And while Redfin projects an average 1% decline in home prices nationwide this year, that may be too modest to reverse affordability challenges for most middle-class households.
Looking Ahead
The market outlook for the rest of 2025 will hinge largely on:
- Federal Reserve interest rate decisions
- Wage growth vs. home price inflation
- Policy actions aimed at boosting affordable housing supply
- Consumer confidence, which is still fragile amid economic volatility
Even as conditions shift slightly toward buyers, affordability remains a core barrier. Until mortgage rates fall meaningfully or more lower-priced homes come to market, many would-be homeowners will remain renters — or simply priced out altogether.
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