Home values are still climbing even as the housing market cools, a split that is reshaping what it means to be a buyer or seller in late 2025. Sales of existing properties ticked up slightly last month, but compared with a year earlier activity remains subdued while prices keep setting records. The result is a market where fewer deals are getting done, yet each successful sale is commanding more money than ever.
That tension between softer demand and stubbornly high prices is now the defining feature of U.S. housing. It reflects a mix of limited inventory, shifting mortgage rates and buyers who are stretching to compete for the homes that do hit the market. Understanding how those forces interact helps explain why prices are still rising even as overall sales struggle to regain their old momentum.
Sales edge higher, but the market is still in a slump
On the surface, the latest numbers suggest a modest rebound. Existing-home transactions rose 0.5% from the prior month, bringing the seasonally adjusted annual rate to 4.13 m in November. That Month Over Month gain shows that some buyers are stepping back in as borrowing costs ease from their peak. Yet the level of activity is still well below the frenzied pace of the pandemic boom, and the recovery so far is more of a crawl than a sprint.
Other data tell the same story of a market that is stabilizing but not roaring back. A separate read on Existing Home Sales shows transactions in the United States increasing to 4,130 Thousand in November from 4,110 Thousand in October of 2025, a small but notable uptick. Industry trackers describe this as evidence that growth is beginning to stall rather than accelerate, reinforcing the idea that the market is still mired in a broader slump even as monthly numbers improve at the margins.
Prices keep climbing, setting new records
While sales volumes remain under pressure, prices are moving in the opposite direction. The national median sales price increased 1.2% in November from a year earlier to $409,200, an all-time high for any November. That means buyers are paying more even as they have less company at open houses, a sign that the underlying supply-demand balance still favors sellers in many parts of the country. For households trying to break into the market, each incremental price increase widens the gap they need to close.
Those record figures are not a one-off. According to recent reporting, Home prices have risen on an annual basis for 29 months in a row, even as the housing market has been mired in a slump. Analysts tracking National home price trends say growth slowed noticeably throughout 2025 compared with the explosive gains of earlier years, but it has not reversed. Instead, appreciation has cooled to a more moderate pace that still keeps values drifting higher, particularly in markets where inventory remains tight.
Inventory is rising, but not enough to flip the script
One reason prices remain firm is that the supply of homes for sale, while improving, is still constrained relative to demand. Recent data show that Inventory was up 7.5% year-over-year in November compared with November 2024, giving buyers slightly more choice than they had a year ago. At the same time, Months of supply decreased, which means the pace of sales is still strong enough to keep the number of available listings from piling up. That combination tends to support prices rather than push them down.
Forecasts suggest that supply alone will not be enough to reset affordability in the near term. One outlook for the property market in Dec notes that Home price growth is forecast to climb at about 3% nationally, even as affordability issues and rising non-mortgage costs weigh on buyers. The same report highlights that new listings are up 68% since November 2024, which should gradually ease some of the worst supply shortages. Yet with demand still outstripping the homes available in many regions, that extra inventory is more likely to slow price growth than to trigger broad declines.
Mortgage rates, regional shifts and buyer behavior
Financing costs are another key piece of the puzzle. After surging earlier in the cycle, mortgage rates have started to retreat, and that shift is coaxing some would-be buyers back into the market. Recent analysis points to Easing mortgage rates and persistent softening in national home prices as factors that supported higher levels of home sales activity from the previous month, even though transactions still showed a decline from a year earlier. Economists expect borrowing costs to remain a swing factor in 2026, with small moves in rates having an outsized impact on how many buyers can qualify.
Regional differences are also becoming more pronounced as the market recalibrates. In The Northeast, for example, existing-home sales saw a 4.1% increase, a welcome sign to prospective homebuyers who had been sidelined by intense competition and limited supply. That contrasts with parts of the country where sales are still slipping year over year, even as prices climb. Nationally, November US home sales rose from the previous month but remained down from 2024 as prices climb, and Economists generally forecast mortgage rates to hover slightly above 6% next year, a level that keeps pressure on affordability even if it is lower than recent peaks.
What slower sales and higher prices mean for buyers and sellers
For buyers, the current environment is a study in trade-offs. On one hand, homes are sitting on the market a bit longer, which can translate into more room to negotiate. Recent figures show that Homes stayed on the market for a median of 36 days in November, up from 34 days last month and 32 days in November 2024, suggesting that bidding wars are less frenzied than they were at the height of the boom. On the other hand, the typical property is more expensive than ever, and buyers still need to move quickly when a well-priced listing appears.
Sellers, meanwhile, are navigating a more nuanced landscape than the one they enjoyed a couple of years ago. The modest Month Over Month gain of 0.5% in existing home sales shows that demand has not disappeared, but it has become more selective. Listings that are priced in line with the market and presented well are still attracting solid interest, while overambitious asking prices are more likely to sit. With the national median at $409,200 and Home prices up for 29 consecutive months, owners who have held their properties for several years are often sitting on substantial equity, but they also face the same affordability and rate questions if they plan to buy again.
The net effect is a housing market that is cooling in volume but not in value. Sales are edging higher from very low levels, yet remain below last year, while prices continue to notch new highs even as growth slows. Unless inventory rises far more sharply or mortgage rates fall enough to unleash a new wave of demand, I expect this pattern of slower activity paired with steady price gains to define the next phase of the cycle.
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Elias Broderick specializes in residential and commercial real estate, with a focus on market cycles, property fundamentals, and investment strategy. His writing translates complex housing and development trends into clear insights for both new and experienced investors. At The Daily Overview, Elias explores how real estate fits into long-term wealth planning.
