Housing Inventory Hits 1.1 Million, Marking 95 Weeks of Annual Gains

• For the week ending August 30, U.S. home listings reached 1.1 million, marking the 95th straight week of annual inventory gains.

• The median home price stayed flat for the fourth consecutive week, with price per square foot also plateauing after two years of growth.

• More homes are lingering unsold as buyers await favorable conditions, heralding a potentially advantageous fall.

Current 30-Year Mortgage Rates Fall Below 6.5%

• The average 30-year fixed mortgage rate dipped to 6.484% as of September 5, 2025, its lowest mark since October 2024.

• The drop stems from weaker jobs data and anticipation of a pending Federal Reserve rate cut.

• These lower borrowing costs drive a surge in refinancing and heighten buyer interest for fall.

Housing Affordability Crisis Deepens: 57% Can’t Afford $300K Homes

• New NAHB data reveal that 76.4 million U.S. households cannot afford a $300,000 home, and affordability has declined in 17 states so far in 2025.

• The median new home price remains $459,826, leaving about 75% of households unable to purchase; policymakers are urged to address impediments to new supply.

• Rising rates and stagnant wages further challenge potential homebuyers.[6]

Mortgage Delinquencies Edge Higher, Foreclosure Starts Rise

• Mortgage delinquencies ticked up to 4.04% in Q1 2025, up 10 basis points year over year, while foreclosure starts rose to 0.20%.

• FHA and VA loans saw slight improvements in performance, but conventional delinquencies increased and inventories of foreclosed homes are up across all loan types.

• Despite these trends, national rates remain below long-term averages, indicating moderate risk.

Fed Set to Cut Rates Amid Lingering Inflation Worries

• The Federal Reserve is expected to lower its benchmark rate by 25 basis points at its upcoming September meeting, boosting hopes for further drops in mortgage rates and refinancing activity.

• Nearly 47% of recent mortgage applications are for refinancing—the highest share since October.

• Market participants remain attuned to the Fed’s moves, seeking relief from persistent affordability hurdles.

Home Builders Ramp Up Incentives as Sales Slow

• Facing excess resale inventory and diminishing buyer demand, a record 38% of builders are offering price reductions and 62% leverage sales incentives to drive transactions.

• New construction starts lag, dropping 4.6% in June month over month and 10% annually, leading to price cuts especially in surplus markets like Texas and Florida.

• Completions are down, and new activity is likely to slow further absent sustained buyer demand.[3]

Digital Channel Origination Accelerates: CFPB Data Show Channel Shifts

• Origination volume and channel mix continue evolving, with digital and broker channels capturing increased market share.

• New loan activity by number and dollar amount is tracked closely by the CFPB, with recent data showing origination recovery in some segments but softness in others.

• These shifts reflect borrower demand for speed and flexibility in an uncertain macro environment.[10]

State Initiatives and Federal Cuts Shape Affordability Policy

• The 2025 State of the Nation’s Housing report highlights a persistent affordability crisis, with federal support threatened by proposed budget cuts.

• State and local governments are stepping in with dedicated funds and targeted development programs to bridge the gap.

• The need for resilient policy and rapid action is compounded by climate and disaster risks.