April 2025 Housing Market: Trends in Sales, Prices, and Supply

The April 2025 housing market reflected a highly mixed landscape shaped by stubbornly high mortgage rates, increased builder caution, and evolving buyer behavior. Existing-home sales declined to the slowest April pace since 2009, while new home sales surprisingly jumped more than 10% from March, defying industry expectations.

Although inventory levels are beginning to rise, affordability concerns and policy uncertainty continue to suppress overall transaction volume. According to data from the National Association of REALTORS®, the median price of existing homes reached a record $414,000, while new homes dipped slightly to $407,200.

Existing-Home Sales Slow Despite Inventory Bump

In the April 2025 housing market, existing-home sales dropped 0.5% month-over-month to a seasonally adjusted rate of 4.00 million. Year-over-year, that’s a 2.0% decline—making it the slowest April performance in 16 years. Despite the sluggish sales pace, inventory of unsold homes rose to 1.45 million, a 9.0% increase from March and a 20.8% jump over April 2024. This translates to a 4.4-month supply, still below a balanced six-month threshold but the highest in five years.

Regionally, sales increased in the Midwest, held steady in the South, and declined in the Northeast and West. According to NAR Chief Economist Lawrence Yun, “Home sales have been at 75% of normal levels despite robust job growth,” underscoring affordability constraints. The median price of existing homes rose 1.8% year-over-year, reaching a record for April. Properties remained on the market for an average of 29 days, with first-time buyers making up 34% of transactions.

New Home Sales Surge as Builders Offer Incentives

New home sales saw a surprising boost in the April 2025 housing market, rising 10.9% from March to a seasonally adjusted rate of 743,000 units. This marks a 3.3% increase over April 2024, according to the U.S. Census Bureau and HUD. However, analysts warn that this may be a short-term spike rather than a sustained trend. Builder confidence, measured by the NAHB in May, dropped to an 18-month low, reflecting rising material costs, tariff uncertainties, and cooling consumer sentiment.

Builders are also increasing their use of sales incentives—61% reported offering options like mortgage rate buydowns to close deals. Inventory of new homes has leveled off near 504,000 units, only a 1.6% increase from January but 8.6% above last year. The months’ supply now sits at 8.1, up from 7.7 one year ago.

Regionally, new home sales year-to-date fell in the Northeast (−32.5%), Midwest (−14.8%), and West (−2.4%) but increased in the South (+5.7%), where demand and affordability remain more favorable.

Permits and Starts Signal Softening in Single-Family Construction

Construction data from the April 2025 housing market highlights a divergence between multifamily and single-family activity. While total housing starts ticked up 1.6% from March to 1.361 million units, single-family starts fell 2.1% to 927,000—marking the lowest rate since July 2024. This suggests that builders are scaling back single-family developments in response to affordability challenges and volatile input costs.

Building permits, a leading indicator of future construction, dropped 4.7% to 1.412 million units, reinforcing expectations of future slowdown. On the completions side, total housing completions fell 5.9% to 1.458 million, with single-family completions down 8.0%. The drop in completions aligns with lower builder sentiment and points to potential supply constraints later in the year.

Despite short-term shifts, overall supply remains higher than a year ago. Many multifamily projects continue to move forward, while single-family construction is facing a recalibration period. If mortgage rates remain elevated and builder confidence continues to decline, a more substantial reduction in starts and permits could follow.

Home Prices and Mortgage Rates Shape Buyer Behavior

Affordability remains the central challenge in the April 2025 housing market. The median price for existing homes hit $414,000—up 1.8% from April 2024—while new homes saw a 2.0% price drop to $407,200. These dynamics suggest that new construction is attempting to adjust pricing to attract buyers, while resale homes remain constrained by limited supply and elevated seller expectations.

Freddie Mac reported an average 30-year fixed mortgage rate of 6.81% as of mid-May, higher than last month but slightly lower than the 7.02% average from one year ago. Even so, these rates continue to limit buyer purchasing power, especially among first-time buyers and those in high-cost regions like the West and Northeast.

Regional price variations further illustrate this divide. The Northeast saw a 6.3% increase in median existing-home prices, while the West posted a 0.2% decline. The Midwest and South remain relatively stable. With resale and new home markets sending different pricing signals, many buyers are looking to incentives and alternative financing options to make homeownership viable.

To learn more about the April 2025 housing market, contact the title insurance and escrow team at Plymouth Title Guaranty Corporation.