Hello Property & Profit readers!
This week, the market is a mix of hesitation and opportunity.
We are seeing mortgage rates tick back up after their recent dip, which is slowing buyer enthusiasm. Yet, the persistent lack of inventory means that well-priced homes are still moving quickly, particularly in the entry-level and mid-tier segments.
From builders cutting prices to the impact of the lingering government shutdown on buyer sentiment, the housing market remains a high-stakes puzzle.
Top Headlines
Finance (Mortgage & Investment) 💲
1. 30-Year Fixed Mortgage Rate Climbs to 6.22%, Snapping Four-Week Decline The average long-term U.S. mortgage rate edged up this week, ending a brief period of lower borrowing costs and potentially cooling buyer interest after rates had hit their lowest level in over a year.
2. Affordability Slowly Improving Despite Rate Tick Up, Says Freddie Mac Chief Economist Even with the slight rate increase, current borrowing costs remain low compared to earlier 2025 highs, which could allow a homebuyer to save thousands annually on a median-priced home and signal a slow, positive trend for affordability.
National Law Review (Freddie Mac) Affordability Slowly Improving Despite Rate Tick Up
3. All-Cash Home Buyers Reach an All-Time High, Averaging 26% of Purchases This record number indicates that cash buyers, many of whom are leveraging equity from a previous sale, are finding a distinct and growing advantage in the market by being able to bypass high mortgage rates and tight lending conditions.
National Association of Realtors (NAR) All-Cash Home Buyers Reach an All-Time High
4. Housing 'Turnover' Lowest In 30 Years as Homeowners Remain Locked In Only 28 out of every 1,000 homes have changed hands in the first nine months of 2025, the lowest rate since the 1990s, demonstrating that affordability challenges and low existing mortgage rates are keeping both buyers and sellers on the sidelines.
National Mortgage Professional Housing 'Turnover' Lowest In 30 Years
5. Small Landlords Still Dominate the Investor Market, Pulling Back Large Institutions Small-scale landlords now capture 62.7% of investor purchases, the second-highest share since 2007, indicating that individual and local investors are increasingly influential in the single-family rental market as large institutions pull back.
Construction (Builder & Supply) 🏗️
6. New Home Glut Spurs Builder Incentives: Price Cuts and Buydowns Reach 5-Year High Builders are now offering the most aggressive incentives in five years, including cash at closing and rate buydowns, in an effort to clear a growing backlog of unsold, newly constructed homes.
7. Multifamily Developer Confidence Increases in Q3, But Remains in Negative Territory While overall sentiment for new rental properties has improved year-over-year, significant challenges like high construction costs and difficulties in securing project financing continue to affect the sector, particularly for mid- and high-rise developments.
National Association of Home Builders (NAHB) Multifamily Developer Confidence Increases in Q3, But Remains in Negative Territory
8. Single-Family Housing Starts and Permits Fall, Indicating a Weakening Residential Sector Single-family housing starts and permits declined in August, suggesting that the housing sector continues to weaken as a consequence of elevated prices and high mortgage rates, despite some builder incentives.
U.S. Census Bureau Single-Family Housing Starts and Permits Fall, Indicating a Weakening Residential Sector
9. Real Estate Investor Sentiment Holds Steady Despite High Prices and Finance Costs Investor sentiment remains largely unchanged, with many flippers shifting to a rental strategy; over half of all investors still expect home prices to continue rising, though rental investors are less optimistic due to rising vacancy rates.
Government (Policy & Regulation) 🏛️
10. Government Shutdown Causes Uncertainty: Buyers Delay Purchases in Federal Hubs The record-long government shutdown is creating uncertainty in the job market, causing homebuyers in areas reliant on federal employment to pause their purchasing decisions to 'wait and see' what happens next with the economy.
11. FHFA Proposes Long-Term Strategic Plan for 2026–2030, Seeks Public Feedback The Federal Housing Finance Agency is asking for public input on its proposed five-year strategic plan, which will shape the operational and regulatory priorities of the U.S. housing finance system, including Freddie Mac and Fannie Mae.
U.S. Federal Housing Finance Agency (FHFA) FHFA Proposes Long-Term Strategic Plan for 2026–2030, Seeks Public Feedback
12. Fed's September Rate Cut Influenced by 'Weakening Labor Market,' Driving Rates Down The Federal Reserve's decision to lower the target federal fund rate was primarily driven by concerns over employment, a key macroeconomic signal that helped ease pressure on the 10-year Treasury yield and, consequently, mortgage rates.
Local (Regional Trends & Pricing) 🏘️
13. Home Prices Increased in 77% of Metro Areas in Third Quarter of 2025 According to NAR's latest quarterly report, home prices continued to rise in the majority of metro markets, demonstrating the resilience of values despite ongoing affordability concerns and high mortgage rates.
National Association of Realtors (NAR) Home Prices Increased in 77% of Metro Areas in Third Quarter of 2025
14. Homeownership Cost Hits 47% of Median Household Income, Exceeding 2008 Pre-Crisis Peak The annual cost of owning a median-priced home now consumes a record 47% of median household income, a shocking figure driven by high home prices, elevated mortgage rates, and rising insurance costs.
15. Northeast and Midwest Lead National Price Gains as South Sees Near-Flat Growth The Northeast saw a 6.0% year-over-year price increase and the Midwest saw 4.2% growth, while the South was nearly flat at 0.5% due to robust new construction, and the West saw a slight price decline.
National Association of REALTORS® Northeast and Midwest Lead National Price Gains as South Sees Near-Flat Growth
16. Texas Home Sales Gaining Modest Momentum Following Mortgage Rate Improvements Pending sales in Texas surged in July, August, and September, signaling a recovery after a sluggish spring market as borrowing costs eased and buyer enthusiasm returned to the state.
Texas Real Estate Research Center (TRERC) Texas Home Sales Gaining Modest Momentum Following Mortgage Rate Improvements
17. Bay Area Housing Market Sees High-Income Tech Buyers Resurge, Creating a 'Split Economy' Record stock market wealth is fueling demand among high-net-worth tech professionals, while layoffs create hesitation for first-time and entry-level buyers, resulting in a sharply divided regional market.
The Times of India Bay Area Housing Market Sees High-Income Tech Buyers Resurge
18. Buyer Confidence Weaker Than Rate-Driven Demand as Job Worries Linger General economic uncertainty and labor market fears are outweighing the incentive of slightly lower mortgage rates for many would-be buyers, especially in areas with recent large-scale corporate layoffs.
Industry (Technology & Market Metrics) 📈
19. Active Housing Inventory Up 14% Year-Over-Year, Marking a Significant Increase in Buyer Options The number of active listings has climbed consistently, offering homebuyers significantly more choices compared to the low-inventory environment of the previous year, a sign that homes are generally sitting longer on the market.
20. First-Time Home Buyer Share Sinks to All-Time Low of 21%, Median Age Rises to 40 The percentage of first-time buyers has reached a historic low since 1981, and their median age has climbed to 40, underscoring the severe real-world consequences of a market starved for affordable inventory.
National Association of Realtors (NAR) First-Time Home Buyer Share Sinks to All-Time Low of 21%, Median Age Rises to 40
21. Median Down Payment Reaches 19% for All Buyers, Highest Level in Decades The typical down payment among all buyers is now 19%, driven by high home prices and lenders' tightening standards, forcing first-time buyers to put down a median of 10% and repeat buyers to put down 23%.
National Mortgage Professional Median Down Payment Reaches 19% for All Buyers, Highest Level in Decades
22. Zonda Acquires Eliant, Signaling Consolidation in Homebuilding Customer Experience Tech The acquisition of Eliant, a leader in customer experience management, by housing market data provider Zonda indicates an industry push to integrate technology and data insights to improve the homebuyer's journey.
23. Housing Market Valuations Face 'Recessionary Territory' as Annual Growth Collapses The annual growth of U.S. housing stock value has collapsed, with inflation-adjusted home values falling 2.3% over the past year, echoing trends typically associated with economic recessions.
24. Commercial Real Estate Investors Focus on Alternatives as Multifamily Investment Slows Faced with challenging market conditions, high capitalization rates, and lower returns in market-rate multifamily projects, investors are increasingly shifting capital toward alternative property types like senior housing and impact-focused investments.
Greystone Housing Impact Investors Commercial Real Estate Investors Focus on Alternatives as Multifamily Investment Slows
25. Housing Starts in the West Drop Sharply as High Costs and Weak Demand Persist Residential Construction in the Western U.S. has seen a significant decline, reflecting that builders are pulling back activity in the face of persistently high material costs and softened buyer demand in key regional markets.
Texas Real Estate Research Center (TRERC) Housing Starts in the West Drop Sharply as High Costs and Weak Demand Persist
In Conclusion
So, what is the big takeaway this week? The housing market is currently acting like that friend who constantly says they are about to leave a party: they are hovering near the door (low rates), but they keep getting pulled back to the buffet (job uncertainty and high prices). Buyers are enjoying more inventory, but they are still waiting for a clearer economic signal—and it looks like they are being patient, even if the builders are not!
Markets move fast, information moves faster.
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