June 2025 Housing Market Update: The Biggest Shift in Decades

Summary

BiggerPockets Real Estate Podcast

Episode: June 2025 Housing Market Update: The Biggest Shift in Decades
Host: Dave Meyer
Release Date: June 20, 2025

Overview

In this insightful episode, Dave Meyer, Head of Real Estate at BiggerPockets, delves into the significant transformations currently reshaping the U.S. housing market. Titled "June 2025 Housing Market Update: The Biggest Shift in Decades," Meyer provides a comprehensive analysis of national and regional trends, explores underlying macroeconomic factors, and offers strategic advice for real estate investors navigating this evolving landscape.

1. National Housing Market Dynamics

Meyer begins by outlining the shift from a seller's to a buyer's market, emphasizing the implications for investors.

Buyer's Market Emergence:
Meyer explains that the market has transitioned into an expanding buyer's market with 2 million sellers versus 1.45 million buyers ([03:30]). This imbalance grants buyers increased negotiating power, allowing them to secure properties below listing prices or obtain favorable concessions.
Price Trends:
Although prices remain up year-over-year, Meyer anticipates a 1-2% national price correction by year's end, aligning with forecasts from Redfin and Zillow ([07:15]). He reassures listeners that this adjustment is not indicative of a market crash, as prices are still significantly higher compared to previous downturns.
Inventory Levels:
Current inventory stands at 1.5 million, moving towards pre-pandemic norms but still slightly below (1.8-1.9 million) ([09:50]). This stabilization suggests short-term market resilience despite the increase in sellers.
Mortgage Delinquencies:
With delinquency rates at 0.86%, Meyer highlights the low risk of a market crash. He contrasts this with the 7% delinquency rates seen during the 2007-2008 crash, emphasizing the current market's stability ([12:40]).

Notable Quote:

"Prices are still up year over year. We are not in any sort of crash." – Dave Meyer ([07:15])

2. Regional Market Variations

Transitioning to regional insights, Meyer identifies key areas experiencing divergent trends.

Markets with Strong Growth:
- Detroit, MI: +9% YoY
- New York City: +6% YoY
- Pittsburgh, PA: +6% YoY
- Virginia Beach, VA: +5% YoY
- Chicago, IL: +5.2% YoY
  These markets are outperforming national averages, reflecting robust demand and economic vitality ([16:10]).
Markets Facing Declines:
- Oakland, CA: -8% YoY
- Dallas, TX: -5% YoY
- Jacksonville, FL & Tampa, FL: -2.4% & -2.1% YoY
  These declines are primarily in previously high-growth, now cooling markets ([19:45]).
New Listings Growth:
Areas like Houston, Columbus, Boston, Indianapolis, and Cincinnati are seeing modest increases in new listings, which could influence future market dynamics ([22:30]).

Notable Quote:

"Sellers are now reacting... choosing not to sell, which balances the market and prevents a full-blown crash." – Dave Meyer ([21:15])

3. Macroeconomic Influences

Meyer delves into broader economic factors impacting the housing market.

Inflation:
Inflation remains relatively controlled, ticking up slightly to 2.4% in May. Meyer notes that while tariffs could influence future inflation, current trends are reassuring ([24:50]).
Labor Market:
Indicators show minor weakening with increases in initial and continuing unemployment claims. However, the labor market remains resilient, contributing to economic stability ([26:30]).
Consumer Sentiment:
Despite stable economic indicators, consumer sentiment has plummeted to near 7-8 year lows. Meyer attributes this to cumulative economic pressures and heightened uncertainty ([28:10]).
Mortgage Rates:
Mortgage rates have plateaued between 6.75% and 7.15% due to conflicting investor sentiments on recession fears versus inflation concerns. This stabilization presents a unique environment for both buyers and lenders ([30:05]).

Notable Quote:

"The U.S. economic policy uncertainty Index is at 470, indicating an unusually uncertain time that affects both consumer behavior and the housing market." – Dave Meyer ([27:20])

4. Strategic Insights for Investors

Concluding the episode, Meyer offers actionable strategies tailored to the current market conditions.

Negotiation and Patience:
In a buyer's market, investors should leverage their negotiating power to secure properties below current market values. Meyer cites that the median asking price is $425,000, while actual selling prices average $397,000 ([33:50]).
Focus on Cash Flow and Value Add:
Meyer advises prioritizing deals that offer break-even or positive cash flow and opportunities for value addition through property improvements or strategic renovations. This approach mitigates risks associated with potential price declines ([35:25]).
Tax Benefits:
Investors should maximize tax advantages such as depreciation and other real estate-specific tax benefits to enhance overall investment returns ([37:00]).
Capital Preservation:
Emphasizing a conservative underwriting approach, Meyer recommends safeguarding capital by avoiding overleveraged positions and ensuring investments are sustainable even without immediate market appreciation ([39:15]).

Notable Quote:

"You need to be very, very disciplined about your acquisition price to protect yourself and take advantage of this market." – Dave Meyer ([34:05])

Conclusion

Dave Meyer wraps up the episode by reiterating the importance of being an informed and disciplined investor in a transforming housing market. By understanding national trends, regional nuances, and macroeconomic factors, investors can identify opportunities while mitigating risks. The key takeaway is to focus on cash flow, value addition, and capital preservation to build a resilient real estate portfolio in these shifting times.

Final Thought:

"If you are diligent and informed, you will be able to find opportunities in this market." – Dave Meyer ([40:45])

Key Takeaways

Buyer’s Market: More sellers than buyers grants increased negotiation power.
Price Corrections Expected: Anticipate a modest 1-2% national price decline.
Regional Highlights: Detroit and NYC leading growth; Oakland and Dallas experiencing declines.
Stable Inflation and Labor Market: Despite rising uncertainty, economic indicators remain stable.
Strategic Focus: Emphasize cash flow, value add, and tax benefits over short-term appreciation.

By staying informed and adopting strategic investment practices, real estate investors can navigate the current market shifts effectively, positioning themselves for long-term financial success.

Summary

BiggerPockets Real Estate Podcast

Episode: June 2025 Housing Market Update: The Biggest Shift in Decades
Host: Dave Meyer
Release Date: June 20, 2025

Overview

1. National Housing Market Dynamics

Meyer begins by outlining the shift from a seller's to a buyer's market, emphasizing the implications for investors.

Buyer's Market Emergence:
Meyer explains that the market has transitioned into an expanding buyer's market with 2 million sellers versus 1.45 million buyers ([03:30]). This imbalance grants buyers increased negotiating power, allowing them to secure properties below listing prices or obtain favorable concessions.
Price Trends:
Although prices remain up year-over-year, Meyer anticipates a 1-2% national price correction by year's end, aligning with forecasts from Redfin and Zillow ([07:15]). He reassures listeners that this adjustment is not indicative of a market crash, as prices are still significantly higher compared to previous downturns.
Inventory Levels:
Current inventory stands at 1.5 million, moving towards pre-pandemic norms but still slightly below (1.8-1.9 million) ([09:50]). This stabilization suggests short-term market resilience despite the increase in sellers.
Mortgage Delinquencies:
With delinquency rates at 0.86%, Meyer highlights the low risk of a market crash. He contrasts this with the 7% delinquency rates seen during the 2007-2008 crash, emphasizing the current market's stability ([12:40]).

Notable Quote:

"Prices are still up year over year. We are not in any sort of crash." – Dave Meyer ([07:15])

2. Regional Market Variations

Transitioning to regional insights, Meyer identifies key areas experiencing divergent trends.

Markets with Strong Growth:
- Detroit, MI: +9% YoY
- New York City: +6% YoY
- Pittsburgh, PA: +6% YoY
- Virginia Beach, VA: +5% YoY
- Chicago, IL: +5.2% YoY
  These markets are outperforming national averages, reflecting robust demand and economic vitality ([16:10]).
Markets Facing Declines:
- Oakland, CA: -8% YoY
- Dallas, TX: -5% YoY
- Jacksonville, FL & Tampa, FL: -2.4% & -2.1% YoY
  These declines are primarily in previously high-growth, now cooling markets ([19:45]).
New Listings Growth:
Areas like Houston, Columbus, Boston, Indianapolis, and Cincinnati are seeing modest increases in new listings, which could influence future market dynamics ([22:30]).

Notable Quote:

"Sellers are now reacting... choosing not to sell, which balances the market and prevents a full-blown crash." – Dave Meyer ([21:15])

3. Macroeconomic Influences

Meyer delves into broader economic factors impacting the housing market.

Inflation:
Inflation remains relatively controlled, ticking up slightly to 2.4% in May. Meyer notes that while tariffs could influence future inflation, current trends are reassuring ([24:50]).
Labor Market:
Indicators show minor weakening with increases in initial and continuing unemployment claims. However, the labor market remains resilient, contributing to economic stability ([26:30]).
Consumer Sentiment:
Despite stable economic indicators, consumer sentiment has plummeted to near 7-8 year lows. Meyer attributes this to cumulative economic pressures and heightened uncertainty ([28:10]).
Mortgage Rates:
Mortgage rates have plateaued between 6.75% and 7.15% due to conflicting investor sentiments on recession fears versus inflation concerns. This stabilization presents a unique environment for both buyers and lenders ([30:05]).

Notable Quote:

"The U.S. economic policy uncertainty Index is at 470, indicating an unusually uncertain time that affects both consumer behavior and the housing market." – Dave Meyer ([27:20])

4. Strategic Insights for Investors

Concluding the episode, Meyer offers actionable strategies tailored to the current market conditions.

Negotiation and Patience:
In a buyer's market, investors should leverage their negotiating power to secure properties below current market values. Meyer cites that the median asking price is $425,000, while actual selling prices average $397,000 ([33:50]).
Focus on Cash Flow and Value Add:
Meyer advises prioritizing deals that offer break-even or positive cash flow and opportunities for value addition through property improvements or strategic renovations. This approach mitigates risks associated with potential price declines ([35:25]).
Tax Benefits:
Investors should maximize tax advantages such as depreciation and other real estate-specific tax benefits to enhance overall investment returns ([37:00]).
Capital Preservation:
Emphasizing a conservative underwriting approach, Meyer recommends safeguarding capital by avoiding overleveraged positions and ensuring investments are sustainable even without immediate market appreciation ([39:15]).

Notable Quote:

"You need to be very, very disciplined about your acquisition price to protect yourself and take advantage of this market." – Dave Meyer ([34:05])

Conclusion

Final Thought:

"If you are diligent and informed, you will be able to find opportunities in this market." – Dave Meyer ([40:45])

Key Takeaways

Buyer’s Market: More sellers than buyers grants increased negotiation power.
Price Corrections Expected: Anticipate a modest 1-2% national price decline.
Regional Highlights: Detroit and NYC leading growth; Oakland and Dallas experiencing declines.
Stable Inflation and Labor Market: Despite rising uncertainty, economic indicators remain stable.
Strategic Focus: Emphasize cash flow, value add, and tax benefits over short-term appreciation.

By staying informed and adopting strategic investment practices, real estate investors can navigate the current market shifts effectively, positioning themselves for long-term financial success.