Borrowing costs may be high, but buyers are less likely to be outbid in a flurry of competing offers
The US housing market swung firmly into seller’s territory at the height of the COVID-19 pandemic, with slashed mortgage rates, a remote-working revolution, and swelling household savings all contributing to a surge in homebuying.
But while that housing boom has long faded into memory, with home price appreciation slowing and in some cases regressing across the country, the advantage hasn’t flipped back entirely towards buyers just yet.
That’s partly because mortgage rates are remaining sticky this year, staying mired in the mid-to-high sixes, as plenty of hopeful buyers await a further drop before making their move.
What that looks like, at least for mortgage brokers, is a degree of normality and a balanced market, strongly favoring neither buyers nor sellers.
Another factor that could be keeping the outlook muted for now is a reluctance among some homeowners to realize that the market has shifted, according to Charlotte-based broker Rebecca Richardson (pictured top).
She told Mortgage Professional America homes were staying on the market for longer because some sellers weren’t prepared to compromise or meet buyers halfway in the purchase process.
“I still think we’re seeing some sellers not willing to accept the reality check that their realtors are giving them,” Richardson said. “This isn’t ’21. This isn’t ’22. You can’t just throw your house on the market and say, ‘Take it or leave it.’”
Balance is back after pandemic-era frenzy
Listed homes sitting unsold has been viewed as a cause for concern by some. But for Richardson, it’s a return to normality after the aberration that was the pandemic buying surge. “People are like, ‘Homes are on the market for 30, 45 days. What’s wrong?’ That’s actually more of what a normal market looks like,” she said.
And while plenty of buyers are still struggling to put together the downpayment needed to make a home purchase work, Richardson said some of those who found themselves priced out during the pandemic are now able to have another serious look at the market.
Between 2020 and 2022, sellers often had the luxury of selecting an offer among scores of bids sometimes well over the original listed price.
But the steep drop-off in demand across many markets means that’s rarely the case anymore. “If it doesn’t sell immediately, then you’re starting to see more seller concessions,” Richardson said. “That’s one of the trends that I’m seeing come back in – whether it’s temporary buydowns or whether it’s just straight seller concessions.
“Not necessarily every deal is having all closing costs paid, but at least enough to keep a little bit of money in the buyer’s pocket so the buyer isn’t having to come up with a huge amount of money and the downpayment and closing cost.”
With two weeks remaining until the Federal Reserve announces its latest rate decision, one Fed governor is making sure everyone knows his feelings haven’t changed since the last meeting.https://t.co/uWwVAobC0n
— Mortgage Professional America Magazine (@MPAMagazineUS) September 4, 2025
A red-hot market no more: Buyers’ negotiating power returns
Prices have fallen in 25 of the US’s largest 50 metro areas, while inventory has risen across the country by 25% from the same time last year – with inventories jumping for 21 months in a row.
What’s more, there’s little sign of a huge rebound in homebuying anytime soon. Fannie Mae expects mortgage rates to fall only marginally between now and the end of the year and still believes they won’t fall below 6% by the end of 2026.
Recent data from the National Association of Realtors (NAR), meanwhile, showed a significant uptick in canceled home purchase agreements during the spring of this year, suggesting some buyers are having second thoughts about purchasing.
All that means buyers now have more supply to choose from and more negotiating power, Richardson said, meaning savvy sellers are accepting that they may have to make some concessions to get their property off the market.
“I think it’s coming back to a little bit more of, ‘How do we find a win-win here?’” she said. “I’m not seeing a whole bunch of ‘We have to submit our highest and best by 5:00,’ or ‘It’s the third round that we’ve gone with the seller and still lost out.’ It doesn’t mean that everybody’s getting every house, but for the most part they’re not facing that.”
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