Welcome to our December 2025 real estate update! In this edition, we're diving into the latest trends and news about the housing market, with insights on price fluctuations, inventory changes, and regional updates. Whether you're buying, selling, or just staying informed, we've got the details you need to navigate the evolving market and make smart decisions.

December 2025 Financial Market News

• Consumer optimism jumped noticeably in December, with the Economic Optimism Index rising from 43.9 to 47.9, reflecting improving sentiment even though the overall reading remains slightly pessimistic.
  
  
• ADP’s report showed a loss of 32,000 jobs in November, but unemployment claims declined, suggesting uncertainty rather than clear weakness.
  
  
• Even after recent ups and downs, the stock market is still close to all-time highs, inflation is about 3%, and people are still spending — signs the economy isn’t falling apart, just cooling a bit.
  
  
• Unemployment rose to 4.6%, which could help push mortgage rates lower in 2026, even as some buyers stay cautious about job security.
  
  
• Tariffs brought in $149 billion for the government this year, but most companies haven’t passed those costs on yet. Economists say some price pressure could show up later, not immediately.
  
  
• Since May, Fannie Mae and Freddie Mac have added $55B+ in mortgages to their balance sheets, helping shrink the gap between mortgage rates and Treasury yields. Rates have already fallen about 0.57% to around 6.2%, and analysts say this strategy could push rates lower into 2026.
  
  

December 2025 National Housing Market News

• “Refuge markets” are on the rise as buyers priced out of big metros shift into smaller, affordable cities like Cleveland, Milwaukee, St. Louis, Providence, and Virginia Beach, where home prices are still 20–30% below the national median.
  
  
• NAR named 10 cities as 2026’s top home buying hot spots, forecasting a 14% jump in existing-home sales and improving affordability, with the strongest opportunities expected in Charleston, Charlotte, Columbus, Indianapolis, Jacksonville, Minneapolis–St. Paul, Raleigh, Richmond, Salt Lake City, and Spokane.
  
  
• Affordability is reshaping where Americans move. Cities like Milwaukee, Louisville, Pittsburgh, and Grand Rapids are becoming hotspots because they offer big-city amenities without big-city price tags — and they’re now posting some of the strongest price gains in the country.
  
  
• Homebuilders are looking ahead to a stronger 2026, with sales expectations turning positive at 52 as falling interest rates boost confidence and increase momentum for new-home demand.
  
  
• Mortgage rate lock-in remains a major barrier to movement since many current homeowners are sitting on much lower rates from previous years, and buying again today would mean paying about $1,000 more per month — a 73% increase — for a similar home, which continues to keep would-be sellers on the sidelines and limits inventory.
  
  
• According to Realtor.com's recent 2026 Housing Forecast, mortgage rates are expected to average 6.3% in 2026, offering slightly more relief than 2025 and helping buyers regain a bit of affordability.
  
  
• Buyer’s agent commissions have inched up since the new NAR rules took effect, rising to 2.42% nationwide as slower home sales give buyers more leverage to negotiate higher compensation for their agents.
  
  
• A new bill aims to let HOAs and condo associations receive FEMA disaster funds directly, bypassing local governments and potentially speeding up recovery by months after hurricanes and other major storms.

December 2025 National Housing Trends

• San Antonio, TX has the strongest U.S. buyer’s market since the post-2008 era, driven by rising inventory and high mortgage rates shifting power back to buyers.
  
  
• Individual buyers are still winning against investors, capturing 69% of all starter-home purchases across 30 major U.S. metros analyzed by Neighbors Bank—The study found that first-time buyers outpaced investors in 25 of the 30 markets, showing that investor activity isn’t dominating everywhere.
  
  
• Inventory keeps climbing, but more slowly. In November, active listings were up 12.6% compared to last year, marking the 25th straight month of growth, but supply is still about 11.7% below 2017–2019 norms.
  
  
• Inventory rose in every region in November, led by the West and South (both up about 14% year over year), while the Midwest and Northeast saw smaller gains and still have much tighter supply.
  
  
• The national median list price in November was about $415,000, down 0.4% from last year and 2.2% from October, with price per square foot also slipping 1% year over year.
  
  
• Home values are now declining in 11 of the 20 major metros tracked by Case-Shiller, all concentrated in the South and West, where affordability challenges and higher inventory have cooled demand.
  
  
• New homes are increasingly being built with two or more full bathrooms, while half-baths are disappearing, reflecting buyers’ growing preference for larger, spa-like bathroom spaces over traditional powder rooms.
  
  
• Affordability is pushing the Northeast and Midwest to the forefront for 2026, as slower price growth, more listings, and average mortgage rates hovering near 6.25% give buyers more leverage — while limited new construction keeps these markets competitive and supports continued price strength.
  
  
• Younger buyers are making progress, with homeownership among those under 35 rising to 37.5%, while the Midwest continues to lead the country with the highest overall homeownership rate at 68.9%.
  
  
• In 2025, only 47% of U.S. households were married couples, down from 66% in 1975, while 29% of households are single-person homes, up from 20%, signaling a shift in how Americans live and buy homes.
  
  
• Only about 11% of Americans moved in 2024, down from 14% a decade ago, as high housing costs and limited affordability keep people staying put longer.

December 2025 Regional Housing Market News

Curious about how the housing market is shifting in your area? Here’s a closer look at the latest trends across different regions of the U.S. From price changes to inventory updates, we’ve got the insights you need to stay ahead in your local market.

December 2025 Northeast Region Housing News:

• Rhode Island launched a new pilot program offering first-time buyers mortgage rates starting below 4%, using up to $60 million in state funds to help partner banks reduce rates and eliminate the need for private mortgage insurance.
  
  
• Richmond, VA, is considering steep penalties for demolishing historic homes — plus new tax incentives to help residents fix them up — as the city works to protect neighborhood character without pushing out long-time homeowners.
  
  
• Boston homeowners could face a 13% property tax hike next year after Massachusetts lawmakers stalled a proposal to shift more of the tax burden onto businesses.
  
  
• Philadelphia approved $277 million to kick off Mayor Cherelle Parker’s four-year, $2 billion H.O.M.E. plan, funding affordable housing construction, home repairs, and first-time buyer assistance as the city works to reverse declining homeownership.
  
  

December 2025 Midwest Region Housing News: 

• New listings are up 9% in Cincinnati with active listings up 18%, and prices rising — giving buyers more options without the extreme competition seen elsewhere.
  
  
• Cleveland is creating a new Department of Development to speed up real estate projects and better manage its 18,000 vacant parcels — empty lots scattered across the city that could be turned into new housing, businesses, or community spaces.
  
  
• Midwest markets are benefiting from affordability and rising buyer interest, with cities like Grand Rapids and Milwaukee expected to post double-digit combined growth (e.g., ~10-11% for Grand Rapids and Milwaukee) as buyers flock to value-oriented metros where prices remain significantly below national averages.
  
  
• Indianapolis is seeing less inbound movement than most big cities, with only about 15% of new residents coming from out of state, ranking 26th out of 37 large metros, as more people move within Indiana rather than relocating from elsewhere.
  
  

December 2025 Southeast Region Housing News: 

• Investor activity remains strongest in the Southeast, with Miami leading at 56.9% of starter-home purchases and Atlanta and Nashville close behind at around 44%, driven by permissive rental laws, rapid growth, and limited local regulation.
  
  
• Nashville now has more million-dollar homes on the market than Austin (1,993 vs. 1,745), even though Nashville is the smaller city — giving it a higher luxury share per capita. 
  
  
• Century Communities is launching more than 100 new homes in Columbus County, NC, bringing $200K-range single-family options to an area trying to reverse population decline while offering buyers affordable living near fast-growing coastal hubs like Wilmington and Myrtle Beach.
  
  
• Atlanta is tilting toward buyers with a 3.4-month supply of homes, a median 84 days on market, and nearly 40% of sellers cutting prices, giving buyers more leverage and breathing room than they’ve had in years.
  
  

December 2025 Southwest Region Housing News: 

• Denver leads the nation in first-time buyer activity, with them capturing 84.3% of starter-home purchases, largely due to strict short-term rental rules that limit investor competition.
  
  
• Inventory surged 33% in Las Vegas, and homes are spending 9 extra days on the market — a major cooling trend after years of overheating.
  
  
• One of the nation’s largest homebuilders is eyeing nearly 500 acres of land in Mesa, Arizona, a move that could pave the way for hundreds of new homes near Phoenix-Mesa Gateway as competition among builders for developable land heats up.
  
  
• Heber, UT stands out as a luxury-heavy market, where about two-thirds of homes for sale are priced over $1M and the median listing price is $1.45M, offering a lower-cost alternative to Aspen, Telluride, and Jackson Hole while still seeing strong luxury demand.
  
  

December 2025 Texas Region Housing News:

• A recent report shows that Texas saw more in-state moves than any other state in 2023, with over 3.3 million people relocating within Texas, while also posting a net gain of 133,000 residents from other states, driven largely by continued inflows from California and Florida.
  
  
• Texas is tilting firmly toward buyers, with San Antonio ranked the strongest buyer’s market in the U.S. (117% more sellers than buyers) and Dallas placing 5th nationally in home turnover at 42 sales per 1,000 homes, helping keep inventory high and prices steadier near $425,000, while Austin, Fort Worth, and Houston also favor buyers — giving Texans the most leverage in nearly 20 years.
  
  
• Liberty Hill, a booming suburb northwest of Austin, is preparing for its first Costco and Target, highlighting ongoing population and development growth in outlying Texas housing markets.

December 2025 Pacific Northwest Housing News:

• Seattle’s inventory surged in November, with active listings up 28.4% year over year, even as new listings fell (-8%), signaling slower buyer activity and more homes sitting on the market.
  
  
• Millennials are pulling back from Portland’s housing market, with their share of mortgage inquiries slipping in 2024 as near-6% rates and a $520K median home price leave few affordable options within reach for younger buyers.
  
  
• Wyoming home values have surged 37.3% since 2020, with the biggest jump occurring in the past year alone, pushing the state’s average home value to $366,565.
  
  
• Central Oregon’s housing market is expected to stay steady into 2026, with flat prices, tight inventory, and homes selling in roughly 50–60 days, signaling a more normal, balanced market.

December 2025 California Housing News:

• The Northern California market continues to soften. Sacramento and San Francisco both posted price declines (up to -5.6% YoY) and longer days on market, creating openings for buyers who were previously priced out.
  
  
• Prices fell 5.7% YoY in San Diego, and time on market increased — a rare moment where one of the priciest metros on the West Coast offers more negotiability.
  
  
• California is investing nearly $1 billion (paid entirely by major polluters) to build thousands of new affordable homes and expand green transportation, including 2,393 new rent-restricted units statewide and major funding for Los Angeles as it rebuilds after recent wildfires.
  
  
• California’s average home value sits at $754,304, down 2.2% year over year, with homes going under contract in about 29 days — a sign of cooling prices but still relatively fast-moving demand in many markets.
  
  

Be sure to check back next month for our updated insights and trends to keep you informed on the latest developments. In the meantime, if you’re thinking about buying, selling, or refinancing, our Home Loan Specialists are always ready to help you make the right move.

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