Spring Home Sales Sputter in U.S. as High Costs Weigh on Buyers

Housing Inventory Rises to Highest Level Since 2020

Sales of existing U.S. homes dropped to a seasonally adjusted annual rate of 4.2 million in April 2025, hitting their lowest level since October 2024, according to new data released by Redfin. The figure marks a 0.2% decline from March 2025, and a 1.1% drop year-over-year–breaking a seven-month streak of annual gains.

Pending home sales, a leading indicator of market activity that includes both new and existing homes, plummeted 3.5% month-over-month–the steepest drop since August 2023. Year-over-year, pending sales were down 2.7%.

The pullback in housing activity reflects growing buyer hesitation amid rising home prices, elevated mortgage rates, and ongoing economic uncertainty. The median U.S. home sale price rose 1.4% from a year ago to $438,466 in April. Though this marks the slowest annual price increase in nearly two years, average monthly mortgage payments hit a new record high due to both rising prices and rates. The average 30-year fixed mortgage rate stood at 6.73% in April–up from 6.65% in March, but down from 6.99% a year ago.

“There’s a general feeling of anxiety in the housing market because no one knows what they’re going to read in the news when they wake up,” said Dan Close, a Redfin Premier agent based in Chicago. “That uncertainty is freaking prospective buyers out, even though in many cases it’s not having a tangible impact on their ability to buy a house.”

Tariff Fears and Economic Worries Undermine Spring Buying Season

Spring is traditionally the busiest season for home buying, but this year, broader concerns–especially about tariffs and trade tensions–have weighed heavily on market sentiment. Despite a recent agreement between the U.S. and China to temporarily reduce tariffs, which lifted stock markets and eased recession fears, the move also nudged mortgage rates higher.

“Even with the temporary tariff relief, rates remain high and so does buyer caution,” said Chen Zhao, Head of Economics Research at Redfin.

Home Supply Rises to Highest Level Since 2020

While demand faltered, housing supply surged. Active listings climbed 1.2% month-over-month and jumped 16.7% from April 2024, marking the highest inventory levels since March 2020. New listings also surged to their highest level since July 2022, up 1.3% month-over-month and 8.6% year-over-year–the strongest annual increase in nearly a year.

“A lot of people are selling their homes and downsizing because they’re worried about the economy,” said Meme Loggins, a Redfin Premier agent in Portland, Oregon. “People who once wanted bigger spaces during the pandemic are now focused on saving money. Many are offloading investment properties or moving into condos out of financial caution.”

The easing of the mortgage rate lock-in effect is also playing a role. Many homeowners who secured historically low rates during the pandemic are now selling, acknowledging that holding out forever is not realistic.

Among major metro areas, Denver saw the biggest annual gain in active listings at 36.3%, followed by Las Vegas (35.8%) and Oakland (32.4%).

Signs of a Buyer’s Market Emerge

With inventory rising and demand slowing, the market has begun tilting in buyers’ favor. Homes are taking longer to sell, and price reductions are becoming more common. In April, homes spent a median of 40 days on the market–the slowest April since 2019–compared to 35 days a year ago and just 18 during the height of the pandemic boom.

The typical home sold for roughly 1% below its asking price–the biggest discount for an April since 2020. Only 30.2% of homes sold above asking, the lowest percentage in five years for this time of year.

“I’ve written ridiculously low offers for buyers that have been accepted,” said Loggins. “I just had a client buy a home for nearly $50,000 below asking–even though comps were higher. Sellers are getting nervous, and buyers who are willing to negotiate are finding deals.”

As the market continues to adjust, buyers are gaining leverage, but affordability remains a major constraint. Whether the coming months bring more stability or deeper uncertainty may depend on economic signals well beyond the housing market.