With supply continuously improving and demand continuing to be weak, December marked the end of a slow and difficult year for the US housing market. Active listings in December increased 12.1% year-over-year (YoY) but down 8.9% month-over-month (MoM), as is typical at this time of year, according to Realtor.com housing data. Homes took longer to sell (+4 days YoY), new listings decreased (YoY and MoM), and prices continued to decline countrywide, with the median list price down 0.6% from the previous year. Regional disparities continued to be glaring behind the national headline trends.
While the Midwest and Northeast continued to lag below pre-pandemic supply levels, the South and West had the strongest inventory recovery; prices (per square foot) rose in the Northeast (+4.1% YoY) and Midwest (+1.7%) while declining in the South (-2.3%) and West (-1.4%). After what was largely a frustrating year for both buyers and sellers, Realtor.com anticipates a slight improvement in 2026—lower mortgage rates, more inventory, and a gradual stride toward better balance.
By separating benchmark markets, or “benchmarkets,” that determine regional housing patterns from “outlier” markets that defy them, this month’s analysis takes a fresh look toward 2025. In the housing industry, extremely local supply and demand dynamics are often overlooked by national and regional averages. In order to address that, we compare metro areas whose local idiosyncratic dynamics predominate with those whose inventory and price changes closely mirror those of their larger region.
The findings highlight the actual inequality of 2025. Certain markets consistently conveyed the regional narrative within each region, while others showed stark differences. These distinctions are important for house purchasers, analysts, and politicians alike: if you live in an outlier market, headline regional narratives may be deceptive. However, striking local tales aren’t usually indicative of more general circumstances. Knowing which metro areas serve as dependable indicators and which are anomalies as the market moves into 2026 makes it easier to see where regional patterns are likely to continue and where the next shocks might appear.
Inventory Increases from 2024, Although it is Still Declining
For the 26th consecutive month of year-over-year inventory growth, there were 12.1% more actively listed properties than at the same time last year. For the first time since April, active inventory dropped below one million homes on a monthly basis, decreasing 8.9% since November (a usual seasonal pattern). The 12.1% YoY gain in December also indicates that the growth of active listings has moderated over the past seven months (down from ~30% peak YoY growth in May and June). December inventory is 12.5% below average 2017–2019 levels nationwide, which is comparable to each of the previous few months.
All four of the major U.S. regions had increases in inventory in December, with the West and South continuing to lead expansion, though at a slower rate than in the summer.
- West: +14.4%
- South: +12.3%
- Midwest: +11.1%
- Northeast: +7.5%.
At the metro level, some 48 of the 50 biggest cities had an increase in inventory over the previous year (Jacksonville and Chicago saw very modest declines in current listings). The top three cities from previous month—Washington, DC (+32.8%), Charlotte (+30.8%), and Las Vegas (+29.2%)—saw the biggest growth.
The startling regional disparity in inventory recovery has already been mapped and its causes explored in previous studies and the Cruel Summer breakdown. Inventory for December is still higher than pre-pandemic levels in the West (+1.1%) and South (+4.5%), but it is still far lower in the Midwest (-33.1%) and Northeast (-50.4%).
Nine of the top 50 metro areas, all in the South or West, currently have inventories that are at least 25% higher than they were before the outbreak. San Antonio (+49.1%), Denver (+48.3%), and Austin (+42.3%) have the highest inventories compared to their pre-pandemic levels.
Conversely, 16 of the top 50 metro areas continue to fall at least 25% short of their pre-pandemic inventory standards.
The three metros that have recovered least are:
- Hartford, CT (-76.2%)
- Providence (-57.1%)
- Chicago (-55.9%)
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The post U.S. Housing Demand Softens Amid Rising Inventories first appeared on The MortgagePoint.
