As we exit the second quarter of 2025, the housing market is painting a clear picture: home prices are beginning a firm downward trend. While there’s no widespread panic among sellers, the negotiating table has clearly shifted in favor of buyers.
This isn’t a crash. It’s a battle—and one that’s playing out with determination on both sides. Sellers are standing their ground, shielding the value of their homes. Buyers, however, now have more leverage, thanks to one powerful ally: supply. With inventory outweighing demand, sellers are finding it increasingly difficult to call the shots.
Let’s take a look at the numbers as of late June:
- 📉 Average Price per Square Foot for Active Listings has dropped 2.4%, from $356.01 to $347.36.
- 📉 Under Contract Listings have dipped 0.2%, from $316.04 to $315.49.
- 📉 Closed Listings are down 1.7%, from $299.52 to $294.33.
- 📉 Median Sales Price softened 0.3%, from $451,000 to $449,500.
(All figures reflect all property types and areas within the ARMLS residential database.)
These figures confirm what we’re seeing in the field: buyers are pushing back on price, and more often than not, they’re getting their way.
The Summer Shift: Why Q3 Is Traditionally the Softest
As we roll into the third quarter, history reminds us that this is typically the weakest stretch for home prices. High summer temperatures don’t just wear down buyers—they slow down the luxury segment most of all. Fewer top-dollar sales means softer averages, even if mid-tier activity remains steady.
Inventory: A Standoff, Not a Retreat
There is some silver lining for sellers. Active listing counts have stopped rising, suggesting we may have hit a temporary ceiling in inventory. But here’s the catch: they’re not falling either. Meanwhile, buyer demand continues to drift quietly downward, with no clear sign of reversal.
This standstill—more of a ceasefire than a surrender—still puts buyers at a modest advantage, especially as the market stays price-sensitive and rate-conscious.
Outlook: Expect More Downward Pressure
Unless we see a meaningful drop in mortgage rates (which currently looks unlikely), we anticipate continued price declines throughout the third quarter. The softening may be gradual, not dramatic, but it is real—and it’s already unfolding.
For sellers, the best approach is to stay strategic, competitive, and well-informed. For buyers, now is a time of greater opportunity—just be ready to act fast when value appears.
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