Housing market faces downturn, vacancies rise; We have nearly 500,000 more sellers than buyers, the most on record.

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The U.S. housing market is facing a dramatic shift, with vacancy rates climbing and pending home sales plunging. The latest data reveals a 28 percent increase in housing vacancies since the second quarter of 2022, bringing the combined vacancy rate to 8.2 percent. Despite claims of shortages, the numbers tell a different story—there are more homes sitting empty, and the trend shows no signs of slowing.

Pending home sales in April 2025 fell 6.3 percent, marking the largest monthly decline since 2022. Analysts had expected a 1 percent drop, but the actual figures far exceeded forecasts. The National Association of Realtors reported that all four regions of the country saw declines, with the Pending Home Sales Index dropping to 71.3. This downturn signals weakening buyer demand, as affordability concerns and rising mortgage rates continue to weigh on the market.

The imbalance between buyers and sellers has reached historic levels. Redfin reports that the market now has 500,000 more sellers than buyers, the highest on record. This surplus is forcing sellers to cut prices, with a growing number of homes selling below list price. The housing market is shifting from a seller’s advantage to a buyer’s market, but many buyers remain hesitant due to economic uncertainty.

Another striking trend is the changing demographics of homebuyers. The median age of buyers has climbed to 56, a sharp increase from 31 in 1981. This shift reflects the growing difficulty younger generations face in affording homes, as wages fail to keep pace with rising costs. Homeownership is increasingly becoming a privilege of older generations, leaving younger buyers struggling to enter the market.

The housing sector is at a crossroads. Rising vacancies, falling sales, and shifting demographics paint a picture of a market in transition. Whether this trend continues depends on economic conditions, interest rates, and policy decisions in the months ahead. For now, the numbers suggest a cooling market, with sellers adjusting expectations and buyers waiting for better opportunities.

Sources
https://www.housingwire.com/articles/nar-pending-home-sales-april-2025/

https://www.realtor.com/research/april-2025-data/

https://www.redfin.com/news/apartments-rented-near-slowest-rate-on-record/