Modest price gains masked a deeper shift in leverage toward selective buyers
United States home prices inched higher at the start of the year, but the market backdrop continued to favor buyers with the means to act, according to the latest Redfin Home Price Index.
National prices crept up 0.3% month over month in January on a seasonally adjusted basis, after a 0.2% gain in December, and were up 2.1% year over year, down from December’s 2.4% rise.
Redfin’s index, which tracked repeat sales of single‑family homes, showed that annual price growth slowed for nearly a full year. It showed how higher borrowing costs and stretched affordability cooled demand even as values remained historically elevated.
The soft national gain masked sharper local swings. Prices fell month over month in 14 of the 50 largest US metros, led by Warren, Michigan (down 1.5%), San Antonio (down 1%) and Minneapolis (down 0.8%).
Philadelphia, on the other hand, posted a 2.6% increase, followed by Providence, Rhode Island (2.5%) and San Francisco (2.1%).
On a yearly basis, Austin, San Antonio and Jacksonville saw the steepest declines, while San Francisco, New York and Milwaukee recorded the biggest gains.
Redfin framed the landscape as one of unusual leverage for active buyers. The firm estimated there were 47% more sellers than buyers, the widest gap in its data and a dynamic that limited price growth even as it failed to produce broad declines.
“Mortgage rates have dipped in recent weeks, which has boosted purchasing power for house hunters, but a lot of folks are still waiting to buy until rates drop further,” Chen Zhao, Redfin’s head of economics research, said.
“The good news is that in the meantime, price growth is limited and buyers have room to negotiate concessions from sellers.”
MBA reported applications down 0.3% last week, while Realtor. com data shows more markets tilting in buyers’ favor—prompting real estate professionals like Marty Green of Polunsky Beitel Green to advise sellers on realistic pricing.https://t.co/vDYhyFMbnQ
— Mortgage Professional America Magazine (@MPAMagazineUS) February 12, 2026
Redfin’s latest pricing snapshot followed a year when many successful buyers negotiated meaningful discounts. In 2025, purchasers who secured a markdown shaved an average of 7.9% off list, the deepest cuts since 2012, and nearly two‑thirds paid below asking.
Moreover, gap between sellers and buyers widened through late 2025, with sellers outnumbering buyers by more than a third in October and surplus supply concentrated in Sun Belt markets such as San Antonio and Austin.
For lenders and originators, Redfin’s January reading reinforces rates that were off their recent highs, an inventory overhang that kept concessions on the table, and price growth that cooled but not cracked.
In this environment, the strongest opportunities lie with well‑qualified borrowers who use their bargaining power on price and terms, rather than waiting for a correction that data has yet to support in most markets.
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