The Great Housing Slump — Sellers Lower Prices, Buyers Still Say “Meh”

For the past decade, listing a house felt a bit like auctioning off a unicorn: sellers slapped on a price tag, opened the lockbox, and watched a parade of escalating bids that somehow made their neighbor’s modest ranch feel like a startup IPO. 

Those days? Consider them evaporating like a spring showing of snow in Phoenix.

Across the country, home sellers are discovering a humbling new reality: buyers are scarce, choosy and inexplicably unwilling to enter bidding wars for what used to be “starter mansions.” 

The national median home listing price ticked up slightly in July to $439,450, but that headline number masks the real story — affordability has cratered. 

According to Realtor.com’s analysis, someone earning the median U.S. household income can realistically afford only $298,000 (assuming a 20% down payment and a 30-year mortgage at 6.74%). 

Translation: 7 out of 10 home shoppers are priced out of the typical listing.

“Welcome to the era of the awkward open house,” said no one, but certainly many... 

Homes are lingering longer, price tags are getting trimmed repeatedly, and sellers are suddenly offering things like lower prices, credits for closing costs, up-front cash to buy down mortgage rates, and the occasional paint job performed with the same enthusiasm you bring to IKEA assembly.

Some of the shifts are regional. 

Inventory is finally creeping up after a years-long drought: active listings rose nearly 25% from a year earlier in July, marking the 21st month of increases. 

That’s good for buyers — especially in Sun Belt hot-spots where new construction is finally catching up. 

In Austin, inventory is up nearly 60% compared to pre-pandemic levels, and houses that once sparked bidding wars are now sparking polite conversations and eventual reductions: Austin’s median home listing price fell 4.9% in July. 

Miami slid 4.7%, Chicago 4.4%, Los Angeles 4.2%, and Denver 4%.

But not everywhere is balanced. 

The Midwest and Northeast still have 40%–50% fewer homes on the market than before the pandemic, leaving sellers there with more leverage — at least for now.

Reality bites hardest for the sellers who thought their granite counter-tops and light-filled sun-rooms would practically pay for their grandchildren’s college tuitions. 

Take Doug McCormick, an 80-year-old retired business owner outside Denver. 

He listed his 4-bed, 4.5-bath in Evergreen for $1.3 million, slid it to $1.28 million — crickets. “I keep reminding myself you only need one buyer,” he said, the kind of stoic optimism that pairs well with early-morning coffee and inventory spreadsheets.

Even agents are sighing into their messaging apps. 

Annie Foushee, a Redfin agent in Denver, put it plainly: “Even though we are seeing a substantial amount of price reductions, sometimes it’s not enough to move the home, it’s still sitting.” She could’ve added a shrug emoji and been done.

Then there are the couples juggling both sides of the ledger. 

Lindsay and John Olesberg listed their 4-bed near Albuquerque for $835,000 in June 2024 when John got a job in Texas. After more than a year of reductions and one agonizing removal-and-relist, they sold for $40,000 below their original ask. 

Buying in Austin was easier: they snagged a five-bed for $735,000, about $30,000 below its initial price. 

“We got less for our house in New Mexico than we would have wanted,” Lindsay, 59, said. In the math of moving, the Olesbergs won the game by losing fewer dollars than the stress they avoided.

GreatHousingslumpOn the other side of the drama are sellers who can afford to play coy. 

Tammy Tullis of South Miami dropped her $2.8 million listing by $100,000 after lack-luster interest — only to be insulted by offers $400,000–$500,000 off. 

“I want to sell, but I’m not in a rush-rush,” she said. 

In other words: flirt with the market, but don’t sleep with it.

What’s driving the stall? 

Mortgage rates climbed up from historic lows starting in 2022 and haven’t given buyers the confidence to leap. 

The Federal Reserve’s move-and-countermove with short-term rates doesn’t always translate into the 30-year mortgage rates consumers actually face (those usually track by the 10-year Treasury). 

Economists expect mortgage rates to linger in the mid-6% range, which keeps monthly payments stubbornly high for buyers on the margin.

So what does a modern seller do?? 

Some price aggressively and accept reality. 

Some sweeten the deal with concessions. 

Some yank their listing and wait for a friendlier season — or for rates to dip. 

And some, like Doug, quietly hope for the single perfect buyer who thinks your vaulted ceilings are worth the premium.

If there’s one silver lining for bargain hunters, it’s this: the housing market is slowly re-calibrating. 

After years where sellers held all the cards, buyers are starting to get some leverage — and in consumer land, that’s usually music to wallets everywhere.

But you must also consider the sellers position; Their loss may be your gain, but remember that old saying: 'What goes around comes around!!

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