The Market Is Shifting — Here’s What Matters

As summer turns to fall, we’re seeing some major shifts in the U.S. housing market — and right here in Boston. Rates are easing, inventory is growing, and price growth is cooling. Here’s what’s happening now, why it matters, and what to watch as we head into year-end.

Mortgage Rates Are Finally Easing
The average rate on a 30-year fixed mortgage has dropped to 6.35% — the lowest in nearly a year.
    •    This decline is driven by falling Treasury yields and expectations that the Federal Reserve will begin cutting rates.
    •    Mortgage application activity — both purchases and refinances — has jumped significantly.

Politics aside, we’re likely getting a rate cut in September and possibly another before year-end. President Donald Trump is expected to appoint a new Fed Chair next May, which could keep downward pressure on rates through spring 2026.

In short: buyers have more breathing room and more purchasing power — but as rates drop, competition will come back fast.

Growing Inventory — But Still Tight
    •    Active listings are up ~26% year-over-year (as of July) — more homes are available than a year ago.
    •    New listings are growing more slowly and remain well below pre-pandemic norms in many markets.
So yes, there’s more to choose from — but supply is still tight enough that great homes are moving quickly.

Home Price Trends: Slowing, But Still Up
    •    National home prices are still rising, but modestly. The median sale price in many areas is only slightly higher than last year.
    •    Some metros — like Stamford-Bridgeport, Hartford, and New Haven — are still seeing strong gains, especially where new construction is limited.

Housing Wealth Is Still Climbing
    •    Total U.S. housing market value hit $55.1 trillion in June 2025, a huge increase from pre-pandemic levels.
    •    Growth is slowing, with most gains coming from appreciation on existing homes rather than new construction.

Affordability Pressures Haven’t Let Up
Housing costs — both owning and renting — are still rising faster than incomes in many markets.
High mortgage rates (even after the drop), rising insurance premiums, and tight supply are keeping affordability stretched.

What It Means for Buyers
    •    The first to act will find the best homes, the best deals, and realize future appreciation.
    •    Lower rates mean more purchasing power — and less competition than we’ll likely see in 2026.
    •    Sellers are more willing to negotiate where price growth has cooled or inventory is higher.
    •    Affordable homes are still scarce, so planning for down payments and monthly costs remains key.

What It Means for Sellers
This is your moment to get ahead of the crowd. Price strategically, launch with impact, and capture buyer demand before more inventory hits the market.

If you’d like to learn how our Three-Phase Marketing Approach at Compass can help you protect your price and maximize your results, reach out — we’d love to walk you through it.

Compass data shows that:
    •    Listings using Three-Phase Marketing sell for 2.9% more than those that go straight to MLS
    •    94% of Compass listings still hit the MLS
    •    40% of those sell over asking — nearly 2x the national average
    •    Of the 6% that stay off-MLS, 80% still sell at or above asking
Phased marketing doesn’t inflate prices — it prevents price cuts and protects value.

What to Watch As We Head Into Late 2025
    •    Mortgage rates: even small moves can change affordability and buyer urgency.
    •    Inventory trends: will more sellers bring homes to market this winter?
    •    Affordability metrics: incomes, taxes, and insurance will dictate what buyers can actually do.
    •    Local policy: zoning, permitting, and electrification mandates can shift costs overnight.
    •    Buyer psychology: fear of being “locked out” of the market can move buyers faster than the numbers alone.

Bottom Line
The market is stabilizing — rates are falling, inventory is rising, and prices are moderating.
For buyers, now may be the best window we’ve seen in a year to buy the right home, before competition returns.
For sellers, there’s still plenty of opportunity — but the right pricing strategy and marketing plan will be key to protecting your value and getting top dollar.