September 12, 2025 Economic and Housing Market Update

September 12, 2025

Overview:

Reports and articles referenced:

Housing data for download:

VIDEO TRANSCRIPT:

• I’m Danielle Hale, Chief Economist at Realtor.com®. In the lead up to the next Fed meeting, I’ll discuss inflation data and how, alongside labor market readings, it could influence the Fed decision. I’ll review what it meant for mortgage rates and what could be ahead. I’ll share what we learned from a pulse check on consumers and their attitudes towards housing plus highlight findings from the latest Realtor.com housing data reports including Monthly Trends, Weekly Trends, and Hottest Markets.  Finally, following up on research about the sizable value of real estate exposed to climate risks, I’ll discuss consumer concerns about homeowners’ insurance. 
• First, inflation data was mixed. Although producer prices fell after a hefty uptick in July, consumer prices edged higher. I don’t expect this to derail a cut in the federal funds rate next week. 
• The Fed has what’s called a dual-mandate. Its two priorities are ‘full employment’ and ‘price stability.’ Despite the fact that prices continue to be thorny, full employment is the side of the mandate that is likely to carry more weight at the next meeting given the softening unemployment rate, lower pace of hiring, and still restrictive rate policy. An uptick in jobless claims to a roughly 4-year high is just another point of support.
• This week’s mortgage rates fell sharply and are now below 6.5% for the first time in 11 months. When mortgage rates dipped into the low 6s last year, we saw a bump in home sales in the following months. And data already point to a sizable increase in purchase mortgage applications. Sales are likely to follow, but this won’t be a total unlock for housing: the majority of homeowners still have outstanding mortgages with rates under 6%.
• Higher mortgage rates have been a key contributor to a slower housing market but home purchase sentiment edged lower in August over job concerns and a more modest home price outlook. 
• The Realtor.com August Housing Trends report aligns, showing that the jump in active listings in the last year led prices to flatten. While the national market has moved into balance, the report reveals regional variation: 7 of the 50 largest markets are already in buyer’s market territory, 23 are in balance, while 20 still favor sellers. 
• With some markets in buyer’s territory, weekly data showed that sellers were less eager to get into the market, with newly listed homes down nearly 2%, the largest annual decline since January.
• There are still plenty of seller’s markets, especially in the Northeast and Midwest, regions that have a lock on our Hottest Markets list. Across the 20 hottest markets, buyer demand helped drive listings prices up by 3.6%.
• Finally, with more than $12 trillion in real estate value exposed to severe or extreme climate risks from flooding, hurricane-driven wind, and wildfire, consumers are facing difficulty obtaining and renewing homeowners insurance and 3 in 4 believe it could become unaffordable if costs continue to rise. This is one of several reasons why I expect climate risk information to be of growing interest to consumers looking for a home.
• You can find all the details, including full reports and our housing data for download, at realtor.com/research.  You can also follow us on X (formerly twitter) for real time updates. And instagram for graphics.

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