Home Prices Hit Slowest Growth Since 2023 as Market Power Shifts

It took 38 days for the typical home to go under contract—the slowest May pace since 2020—and sales were canceled at the highest May rate on record

SEATTLE--(BUSINESS WIRE)-- (NASDAQ: RDFN) —The median U.S. home-sale price rose 0.7% year over year in May—the slowest growth since June 2023. That’s according to a new r epo r t from Redfin (redfin.com), the technology-powered real estate brokerage. Still, last month's median sale price of $440,997 was the highest of any May in records dating back to 2012.

Redfin recently predicted that home prices will start falling on a year-over-year basis by the end of 2025. That has already happened in 11 of the 50 most populous U.S. metropolitan areas, with Oakland, CA (-6.7%), Jacksonville, FL (-5.2%) and Dallas (-4.6%) leading the declines in May.

Home Price Growth Is Cooling Because Sellers Outnumber Buyers

U.S. home price growth is slowing because there are significantly more home sellers than buyers in today’s market—the result of prohibitively high homebuying costs and economic uncertainty.

Existing-home sales came in at a seasonally adjusted annual rate of 4.21 million in May, the lowest level since October, as mortgage rates remained elevated near 7%. Existing-home sales, overall home sales and pending sales were all little changed from both a month earlier and a year earlier.

Meanwhile, the supply of homes for sale (active listings) hit the highest level since March 2020, rising 0.7% month over month on a seasonally adjusted basis and 16.2% year over year. Active listings are climbing because the mortgage rate lock-in effect is easing, but also because homes are taking longer to sell, causing stale inventory to pile up. The typical home that went under contract in May did so in 38 days—nearly a week longer than a year earlier and the slowest May pace since 2020. This is roughly how long it took homes to sell before the pandemic.

“The market has been shifting in buyers’ favor, but it doesn’t feel that way to many Americans because homebuying costs remain near record highs,” said Redfin Senior Economist Asad Khan. “Buyers may gain more negotiating power in the coming months as more sellers face a tough reality: Sellers no longer hold all the cards.”

Less than one-third (31.2%) of homes that sold in May went for over their asking price, the lowest May share in five years, signaling buyers have already gained some bargaining power.

New Listings Are Losing Steam

While active listings rose in May, new listings fell 2.9% month over month on a seasonally adjusted basis, and rose 2.9% year over year—the slowest annual growth since November.

“We’ve hit a plateau with home prices. A lot of homeowners are considering renting their homes out instead of selling,” said Rob Wittman, a Redfin Premier real estate agent in the Washington, D.C. area. “The buyers who come through on tour these days have little urgency. They’re often browsing instead of buying because they're hoping mortgage rates will come down, even though that's unlikely to happen soon.”

Redfin predicts mortgage rates will remain near 7% for the rest of the year.

Some Home Purchases Are Falling Through as Buyers Get Cold Feet

Roughly 59,000 home-purchase agreements were canceled in May, equal to 14.6% of homes that went under contract that month. That’s the highest May percentage in records dating back to 2017 and is up from 14% a year earlier.

Florida and Texas, which have seen their housing markets slow considerably in recent months, had the highest rate of cancellations among the major metros Redfin analyzed. San Antonio came in first (21.3%), followed by Orlando, FL (20%) and Jacksonville, FL (19.7%).

May 2025 Housing Market Highlights: United States

	May 2025	Month-over-month change	Year-over-year change
Median sale price	$440,997	0.6%	0.7%
Existing-home sales, seasonally adjusted annual rate	4,206,157	0.0%	-0.3%
Pending home sales, seasonally adjusted	478,047	-0.4%	0.7%
Homes sold, seasonally adjusted	427,418	0.1%	-0.6%
New listings, seasonally adjusted	546,228	-2.9%	2.9%
Total homes for sale, seasonally adjusted (active listings)	1,960,258	0.7%	16.2%
Months of supply	3	-0.2	0.6
Median days on market	38	-2	6
Share of homes that sold above final list price	31.2%	0.9 ppts	-3.8 ppts
Average sale-to-final-list-price ratio	99.4%	0.1 ppts	-0.5 ppts
Pending sales that fell out of contract, as % of overall pending sales	14.6%	0.8 ppts	0.6 ppts
Monthly average 30-year fixed mortgage rate	6.82%	0.09 ppts	-0.24 ppts

Note: Data are subject to revision

Metro-Level Highlights: May 2025

Sales

Pending sales rose most in the Midwest: Cincinnati (8.2%), Indianapolis (6.7%) and Milwaukee (6.6%) saw the biggest increases. Six of the 10 metros where pending sales rose fastest are in the Midwest, which has attracted homebuyers because it’s relatively affordable.
Pending sales fell most in Florida: Miami (-19.6%), Fort Lauderdale, FL (-16.9%) and Las Vegas (-12.8%) saw the biggest declines. Florida is home to four of the 10 metros where pending sales fell fastest.
Closed home sales rose in just eight metros, with the largest increases in Providence, RI (4.5%), Indianapolis (3.3%) and Kansas City, MO (2.4%).
Closed home sales fell most in Florida: Miami (-23%), San Jose, CA (-22.5%) and Fort Lauderdale (-19.4%) saw the largest decreases.

Prices

Prices rose most in the Northeast: Philadelphia (10.9%), New Brunswick, NJ (8.4%) and Providence (7.7%) saw the biggest upticks. A relative inventory shortage may be fueling price gains in the Northeast.
Prices fell most in Oakland, CA (-6.7%), Jacksonville, FL (-5.2%) and Dallas (-4.6%). Of the 11 metros where prices fell, four are in Texas, three are in California and two are in Florida. Housing markets across Florida and Texas have cooled rapidly amid a surge in homebuilding, rising insurance costs and extreme weather events.

Supply

New listings rose most in Kansas City, MO (17.5%), Houston (10.1%) and Seattle (9.9%).
New listings fell most in San Jose (-16.7%), Orlando, FL (-10.7%) and Jacksonville (-9.2%). Six of the 10 metros where new listings fell fastest are in Florida. New listings in parts of Florida are coming back down to earth after surging in recent months.
Active listings rose most in Las Vegas (35.9%), Denver (30.2%) and Seattle (30.1%).
Active listings fell in just one metro: Detroit (-0.2%). The smallest increases were in Nassau County, NY (1.9%) and Chicago (2.6%).

Speed/Competition

Florida saw the biggest uptick in days on market: In Orlando, the typical home that went under contract did so in 51 days, up 19 days from a year earlier—the biggest increase among the metros Redfin analyzed. Next came Fort Lauderdale (+18 days) and Miami (+14 days).
Days on market dropped in four metros: Kansas City, MO (-6 days), New York (-4), San Francisco (-2) and Philadelphia (-1).
Homes were most likely to sell above their list price in Newark, NJ (69.1% of homes sold above list), San Jose (60%) and San Francisco (59.9%).
Homes were least likely to sell above their list price in Florida: West Palm Beach, FL (6%), Miami (7.7%) and Fort Lauderdale (9.3%) had the lowest share of homes selling above list. Florida is home to six of the 10 metros where homes were least likely to sell above list.

To view the full report, including charts and full metro-level data, please visit:

https://www.redfin.com/news/home-prices-cool-still-at-record-may-high

About Redfin

Redfin (www.redfin.com) is a technology-powered real estate company. We help people find a place to live with brokerage, rentals, lending, and title insurance services. We run the country's #1 real estate brokerage site. Our customers can save thousands in fees while working with a top agent. Our home-buying customers see homes first with on-demand tours, and our lending and title services help them close quickly. Our rentals business empowers millions nationwide to find apartments and houses for rent. Since launching in 2006, we've saved customers more than $1.8 billion in commissions. We serve approximately 100 markets across the U.S. and Canada and employ over 4,000 people.

Redfin’s subsidiaries and affiliated brands include: Bay Equity Home Loans®, Rent.™, Apartment Guide®, Title Forward® and Walk Score®.

For more information or to contact a local Redfin real estate agent, visit www.redfin.com. To learn about housing market trends and download data, visit the Redfin Data Center. To be added to Redfin's press release distribution list, email press@redfin.com. To view Redfin's press center, click here.