Co-authored by Redfin and Mike Larson, Editor-in-Chief at MoneyShow
If you’re just starting out in real estate, the housing market might feel like a puzzle with too many moving pieces. Prices rise, then fall. Homes seem plentiful one year and scarce the next. If interest rates climb before you’ve locked in a mortgage, your potential monthly payment may change drastically.
Learning how to recognize and adapt to these housing market trend shifts can help you whether you’re thinking about buying, selling, or simply keeping an eye on the market.
To help break it all down, we’ve partnered with MoneyShow, where leading voices in real estate recently shared their insights on the firm’s Virtual Expo platform. In this Redfin guide, we’ll walk through key forces shaping real estate today, then take a closer look at expert perspectives on what’s happening in 2025. Whether you’re eyeing a home in Los Angeles, CA or in Boston, MA, this piece aims to give you the context to read the market with more clarity.
Why market trends matter
Trends are more than talking points; they provide context and guardrails for decision-making. Without them, you can easily misinterpret short-term spikes or dips as something more permanent.
Here’s what Redfin data shows right now:
- In August 2025, U.S. home prices rose 1.5% year-over-year, with a median sale price of about $439,419.
- Meanwhile, the number of homes sold declined 2.5%, while active listings increased 10.1% over the same period.
- One telling statistic: there are nearly 500,000 more sellers than buyers in the U.S. market, so far the largest gap on record per Redfin’s data.
- And just over 28% of homes are selling above asking price, down from around 32% a year ago.
What this data suggests:
- The fact that listings are rising while sales are falling points to loosening demand and more room for negotiation.
- The surplus of sellers relative to buyers is a classic signal of a buyer’s market in many places, meaning buyers might gain more leverage.
- Slower sales and softer competition reduce the likelihood of intense bidding wars, making timing a little less frantic (though local dynamics still matter a lot).
In short, trends turn noise into a pattern, helping you see when markets might be cooling, heating, or settling into balance.
Core factors that shape the market
To make sense of trends, it helps to understand the forces at play. Below are the big factors and how they show up in today’s data:
- Supply and demand: The balance between available homes and eager buyers shapes prices and negotiation power.
- Interest rates: Higher rates make mortgages more expensive, reducing affordability and often cooling demand. Lower rates can draw more buyers in. Check Redfin’s mortgage calculator to see how rates affect monthly payments.
- Regulations and policies: Local or state rules, like short-term rental restrictions or new tax proposals, can shift the profitability of owning property in certain areas.
- Investor activity: From small landlords to larger investors, their decisions to buy or hold properties can influence both supply and competition.
Think of these as the “levers” that keep the housing market in motion.
Read>> Is Now a Good Time to Buy a House?
A look at the current real estate market
So, what do these trends look like right now? According to MoneyShow contributing experts, 2025 is shaping up to be a year of transition, where stability is starting to return, but not without a few surprises.
Multifamily opportunities may be emerging
Kathy Fettke, founder of RealWealth.com, says multifamily is entering a “very different world” than recent years. With less new supply coming online compared to 2023–2024, she expects pricing and rents to stabilize. She calls this period a potential “sweet spot” in the cycle for investors.
When supply is constrained, the existing rental stock gains importance. For anyone watching markets with strong demand for rentals, that could mean more steady cash flow and less volatility than in oversupplied conditions.
Single-family homeowners are holding steady
Fettke also pointed out that today’s homeowners aren’t facing the same struggles seen during the mid-2000s housing bust. Because so many are locked in low, fixed-rate mortgages, they’re not under pressure to sell even if rates are high now. That stability makes a widespread housing crash unlikely.
For everyday buyers, this means that while prices may still feel high, they’re less likely to see sharp, destabilizing drops. It’s a reminder that not all “slowdowns” in the market are the same.
Foreign buyers and life changes are bringing movement
Patrick Duffy, senior real estate economist at U.S. News & World Report, notes that foreign buyers are gradually returning, adding to housing demand. He also highlighted how the so-called “lock-in effect” is fading. Even with low-rate mortgages, people eventually need to move for new jobs, growing families, or other life changes.
This is an important reminder that the housing market is never static; life events and outside buyers create churn even when affordability is tight.
Investors remain an active presence
Thomas Malone, principal economist at Cotality, observes that small and mid-size investors still account for about “25–30% of market activity.” Even as the broader market cools, their continued presence supports stability in certain segments.
That mix of participation helps explain why supply imbalances don’t always lead to large price declines — investor demand can absorb some slack, especially in markets with rental demand or upward momentum.
The takeaway
Housing market trends can seem complicated at first, but they’re really just the push and pull of supply, demand, interest rates, and human behavior. Learning to recognize these signals helps you put the news you hear and the listings you see in context.
For anyone beginning their journey in real estate, the goal isn’t to predict the future; it’s to understand the forces at play so you can make informed, confident decisions when the time is right.
English (US) · 