Why Inventory Is Slowing in 2 Regions—and How Lower Rates Are Boosting Buyer Interest

Abundant inventory is giving home shoppers more choices. With mortgage rates lower compared to last year, more home listings, along with softening prices, the housing market is seeing a shift, according the latest Realtor.com® Weekly Housing Trends report.

The average rate on a 30-year fixed home loan was 6.23% for the week ending Nov. 26, according to Freddie Mac. The rate comes in lower than the prior week, when it was at 6.26%.

The report found that the lower rates have encouraged some buyer activity, but affordability is still a challenge compared to pre-pandemic norms.

"The market dynamics are moving in buyers' favor, but weak buyer sentiment seems to be holding the housing market back," explains Joel Berner, senior economist at Realtor.com. "Many would-be buyers are concerned about their incomes and personal budgets, which makes them reluctant to engage in a major purchase. Without a boost of confidence in the economy at large, rates and prices may have to come down further to entice more home sales."

The Federal Reserve will have its last meeting of the year in mid-December. Leading into that, the governors will have some key data, including the delayed September jobs report, which delivered a mixed message.

Job gains were solid, but a higher 4.4% unemployment rate will leave the Fed with a "tougher call on future rate cuts and adding uncertainty to where mortgage rates head next."

Home shoppers and sellers are dealing with a market with a mix of factors: modestly higher inventory and longer selling times giving buyers more leverage, price adjustments by sellers reflecting slower demand, and uncertainty in labor and monetary policy shaping expectations for early 2026.

By the numbers

Inventory continues to sit on the market. Active inventory climbed 12% year over year. This is driven by homes sitting on the market compared to new listings. About 1.06 million homes were for sale last week—the 30th consecutive week above the million mark. It's giving buyers more selection, but it also means more competition for sellers.

Two regions where inventory growth has slowed are the South and the West. This has offset modest gains in the Northeast and Midwest and stalled the overall national recovery, according to Realtor.com monthly data.

"Though there are a few pockets of the market where bidding wars and above-asking offers are still occurring (primarily in the Northeast), the majority of local markets look much different than they did during the [COVID-19] pandemic-era buying boom," Berner says. "Homes are spending longer on the market, getting more price reductions, and behaving more like 'normal' times before COVID."

Data for the week ending Nov. 22 shows that new listings remained flat—rising 0.3% year over year—which signals that moderation is continuing after last week's modest uptick. New listings are a measure of sellers putting their homes up for sale.

Homes are staying on the market two days longer than a year ago—it's a slight increase. The report found it's not uncommon to see longer selling times in November, but this year's pace is not rising as sharply. This could be a reflection of sellers adjusting prices to meet buyers' expectations.

Price reductions and lower list prices are helping to slowly move transactions.

"This is generally a slower time of year in the housing market, though savvy buyers recognize it as an opportunity," says Berner. "There is less competition from other buyers and a higher concentration of motivated sellers whose homes have been on the market for much of the year, making the holidays a great time to score a deal."