Housing Market Tips Toward Buyers as Sellers Outnumber Them by 63%

A record gap between sellers and buyers

The U.S. housing market has moved into territory it has not seen since the years after the financial crisis. According to Redfin, there were an estimated 62.6% more home sellers than buyers in September, the widest gap in its records, which go back to 2013. It was also the fourth straight month that the gap set a new record, and it widened sharply from 56.9% in August.32

The raw counts show how lopsided things have become. Redfin estimated about 1.51 million active sellers against roughly 929,000 active buyers, or about 163 sellers for every 100 buyers.35 The number of buyers fell 2.4% from August to the lowest level on record, its fifth monthly decline in a row. Sellers rose 1.2% to their highest count since March 2020.38

The gap is growing because buyers are leaving, not because a wave of new listings has arrived. Inventory is building mostly from homes that sit unsold and pile up month after month. At the same time, many owners have stopped waiting for better conditions and are listing anyway.38 Redfin's own framing carries a key warning: this is a buyer's market only for people who can afford to buy.32

Prices bend but haven't broken

For anyone expecting the shift in leverage to show up as falling prices, the September figures from the National Association of Realtors push back. The median existing-home price was $417,500, up 1.3% from a year earlier. That marked the 39th straight month of annual gains.21 NAR chief economist Lawrence Yun said it was the highest median ever recorded for a September.27

The headline number hides some softening. Haver Analytics noted that the median fell 2.4% from August, its lowest level since April. Single-family prices have now dropped month over month three times in a row.26 Seasonal patterns explain part of that decline, and NAR warns that only year-over-year price comparisons are valid.21 Redfin also reported that the typical asking price recently fell to its lowest level in a year, which suggests sellers have stopped pricing as if it were 2021.37

The most useful lens here is regional. In NAR's data, prices rose 4.7% in the Northeast and 3.1% in the Midwest. The South was up just 0.2%, and the West slipped 0.3%.25 Redfin's metro numbers point the same way. Miami, Nashville and Houston have the biggest surpluses of sellers. The only five seller's markets left are Nassau County, New York; Montgomery County, Pennsylvania; Newark; Milwaukee; and San Francisco. In those five, prices rose about 6.4% in August, compared with roughly 1% across buyer's markets.32 In practice, there is no single national housing market right now. The Sun Belt is going through a real price correction in all but name, while supply-starved metros in the Northeast are still competitive.

Seller concessions show leverage moving even where list prices hold. Redfin found that 44.7% of buyers received concessions in August, the highest August share since 2020. In Atlanta the figure was 72.8%.36

Sales stuck below 4 million

Transactions remain sluggish. Existing-home sales rose 1.5% in September to a seasonally adjusted annual rate of 3.99 million, but that was still 2.2% below a year earlier.21 Yun played down the monthly gain because August was revised lower. He called August and September the two slowest months of the year and described the market as scraping the bottom of its range.27 In his view, supply is no longer the problem and demand is what is shrinking.27

The supply numbers support that. Inventory reached 1.60 million homes, the most since November 2019. That equals 4.8 months of supply, the highest since November 2015.26 For comparison, the 3.99 million sales pace is far below the roughly 5.2 million annual level that has historically been normal.23

Coverage differs on how to read this. In September, CNN noted that the pace of sales through August was roughly unchanged from the year before. It framed buyers as gaining leverage they did not yet feel.31 A month later, Redfin's assessment is darker: tours are down, sales are at a 12-year low and more deals are falling through.37 The later data favors the more pessimistic view.

Mortgage rates are the main story

The biggest reason buyers are pulling back is the jump in borrowing costs. Freddie Mac's average 30-year fixed rate stood at 7.40% on October 15, unchanged from a week earlier. That compares with 6.95% four weeks ago and 6.30% a year ago.4 The Mortgage Bankers Association's measure reached 7.50%, its highest since November 2023.43 CNN tied the rise to the U.S. war with Iran.31 Redfin pointed to the conflict's effects on oil prices, bond markets and inflation.37 The September Consumer Price Index added to the pressure, showing annual inflation speeding up to 3.7%.48

Timing matters for reading the sales data. The September closings came from contracts signed when rates were lower: Freddie Mac's average was 6.86% that month, according to Haver.26 The latest move above 7.4% will mostly show up in later reports. Yun warned that the recent rise means fewer buyers can qualify.27

Forecasts are catching up

One clear split in the coverage is between older and newer rate forecasts. Some outlets still cite year-end projections of about 6.8% from Fannie Mae and the MBA.110 Fannie Mae's October forecast, however, raised its call to 7.4% for the fourth quarter of 2026 and 7.5% for every quarter of 2027.3 The MBA's October outlook is slightly lower, at 7.3% at year-end and easing to 7.1% by late 2027.3 Fannie Mae also expects the 10-year Treasury yield to stay around 5.3% through both years, which is the main reason it sees no relief.3

The newer forecasts are the ones to rely on. Readers should treat any claim that rates are heading toward 6% as outdated. At least one consumer guide published this month still lists the 30-year rate at about 6.1%, which is far from the real numbers.33 In the very short term, forecasters are split. In a Bankrate poll, 57% of rate-watchers expected rates to rise in the coming week.2 Another weekly forecast leaned toward a slight decline, with low confidence.5

Mortgage demand is falling

Weekly application data shows demand weakening in real time. MBA applications fell 4.2% in the week ending October 2. Refinancing dropped 8% and was 56% below a year earlier.41 The next week, applications fell another 2.7%, and the purchase index dropped 4%. Purchase applications were 16% lower than a year earlier.43

Borrowers are turning to adjustable-rate loans to lower their payments. The ARM share reached 10.5%, the highest since October 2025.47 A separate measure based on credit pulls, the Xactus Mortgage Intent Index, held steady after two weeks of decline but remains about 20% below last year.43 Analyst Bill McBride of CalculatedRisk expects existing-home sales to slow in the coming months and prices to come under pressure.47

Builders send mixed signals

New construction offers no clear signal of recovery. Housing starts ran at a 1.275 million annual rate in August, down 2.6% from July. Permits fell 2.7% to 1.394 million.11 Single-family starts rose 7.6% to 918,000, but that was partly helped by an upward revision to July. Single-family permits, which point to future building, fell 1.8%.20 Starts of buildings with five or more units dropped 22.5% from July.16 Completions fell 27.1% from a year earlier, and 280,000 permitted units had not yet broken ground.1819 With existing-home inventory near a decade high and buyers scarce, builders have little reason to speed up. The September starts report, due October 20, will show whether higher rates have started to slow groundbreakings as well.12

The bottom line

The term "tipping point" fits, but not in the way many hopeful buyers would like. Leverage has clearly moved to buyers: there are record seller surpluses, more concessions and asking prices are softening.3236 The same rate shock that gave buyers this leverage is also pushing many of them out of the market. Today's buyer's market rewards cash-rich households and buyers in the Sun Belt. It does little for first-time buyers stretched by 7.4% mortgages.437

Forecasters agree the market is cooling and do not see a crash coming. That view rests on the lack of widespread forced selling and on prices that are still roughly flat nationwide.34 Our read is that the market is likely heading into a long period of stalled sales and slow price erosion in oversupplied regions, rather than a quick reset.