Podcast Summary: BiggerPockets Real Estate Podcast
Episode: Sellers Do What No One Expects | Dec. 2025 Housing Market Update
Host: Dave Meyer (Head of Real Estate, BiggerPockets)
Date: December 22, 2025
Episode Overview
In this December 2025 housing market update, Dave Meyer delivers a detailed analysis of the current real estate landscape and sets expectations for 2026. He covers the year’s price trends, shifting mortgage rates, improving affordability, the evolving behavior of home sellers, and ongoing market stress indicators, including underwater mortgages and delinquencies. Throughout, Dave aims to clarify misconceptions and offer actionable insights for investors and homeowners navigating a complex and sometimes contradictory real estate market.
Key Discussion Points & Insights
1. National Housing Market Trends: Prices Cooling, Not Crashing
[00:00–04:00]
- Year Overview: At the start of 2025, rates were high (in the sevens), inventory was rising, and fears of a crash abounded. As of December, the market has avoided a crash, with significant shifts in data suggesting a new landscape heading into 2026.
- Price Movement: According to Redfin, national home prices are up 1.4% year over year—a figure considered "flattish" and not indicative of a crash or drastic downturn.
- Context: Last year, appreciation was 5% (well above the historic average of 3.5%). Now, appreciation has cooled but not reversed on a national scale.
Quote:
“According to Redfin, prices are up 1.4% year over year… not bad given where we started this year.” — Dave Meyer [01:10]
Regional Highlights
- Market Corrections: About one-third of metro areas (105 of the 300 largest, per Zillow) are experiencing downward price corrections, concentrated mainly in Florida and parts of the Gulf region (Texas, Louisiana).
- Notable Declines: Punta Gorda, FL (-13%), Cape Coral, FL (-10%), North Port/Sarasota, FL, and Naples, FL are top decliners.
- Strongest Markets: Midwest cities like Chicago, Milwaukee, and Cleveland still show modest appreciation, though rates have slowed.
2. Mortgage Rate Developments: Welcome Relief
[04:00–09:50]
- Downward Trend: Mortgage rates have dropped from a peak of 7.25% (January) to 6.25% (December), which Dave views as a significant positive shift.
- Implications: The 1% rate drop brings millions back into the market, enhances affordability for both investors and homeowners, and makes refinancing substantially more attractive.
Quote:
“A 1% drop in mortgage rates over the course of a year is good news. That is a positive thing for the housing market.” — Dave Meyer [06:00]
- Refinancing Tip: With a full percentage point decrease in rates, refinancing can potentially offer hundreds in monthly savings. Dave shares a listener story where refinancing advice led to $800/month savings.
Quote:
“I actually got a message on Instagram yesterday from a guy who said that I saved him $800 a month … because I told him to refinance before the rate cut.” — Dave Meyer [08:45]
- 2026 Outlook: If the Fed continues rate cuts and yields fall, mortgage rates could dip further, possibly into the high fives percent. Drastic drops are unlikely unless the wider economy shifts dramatically.
3. Housing Affordability: Taking Baby Steps in the Right Direction
[10:52–14:40]
- Best Level in Years: Affordability has improved, reaching its best point in 2.5 years (as of September data).
- Adjusting for Inflation: While prices are up nominally, real prices (adjusted for inflation) are down, making homes more affordable relative to rising wages and easing rates.
- Midwest Leading: Out of the 100 largest US markets, 12 (mostly Midwest) have affordability reset to historical averages—a small share, but a meaningful change.
Quote:
“The trend was moving in the opposite direction for so long ... and fortunately I think that's the direction we're heading [toward more affordability].” — Dave Meyer [12:25]
4. Seller Behavior: The Surprising Wave of Delistings
[14:40–22:40]
- Inventory Fears Debunked: Despite earlier panic over inventory rising 25–30% YOY early in 2025, growth has slowed drastically. As of October, inventory is up only 4% YOY and remains below pre-pandemic levels.
- Listings are Flat: New listings are "completely flat"—not the flood some feared.
- Delistings Surge: The biggest change is in homes being delisted (removed from sale without selling). Highest delisting rates since 2017.
Quote:
“The change that is happening right now is what's called delisting... Sellers are looking at the current market, seeing sales conditions not great, and just saying, ‘nah, I’m kind of out on this one. I’m going to wait this one out.’ ” — Dave Meyer [18:50]
- Rationale: Homeowners opt to stay put or rent, rather than sell at lower prices; this is suppressing inventory and stabilizing prices.
- Regional Delisting Hotspots: Austin, Miami, Fort Lauderdale, Dallas, Denver.
- Re-listing Data: Only 20% of delisted properties have come back on the market so far, likely due to seasonality; more may reappear in spring.
Quote:
“If you don’t like selling conditions, then you delist your property. And that’s why I say this is a normal correction.” — Dave Meyer [20:55]
- Implication: With inventory under control and delistings high, Dave asserts the market is correcting rather than crashing.
5. Market Stress: Underwater Mortgages, Delinquencies, and Foreclosures
[27:39–39:55]
- Underwater Mortgages: Recent headlines noted 900,000 underwater mortgages (1.5% of all mortgages). Dave downplays the alarm—underwater status alone does not mean imminent disaster or forced sales.
Quote:
“Mortgages being underwater is not a disaster. It is not an emergency. It is something that happens quite frequently... The most common reaction to that is waiting. You just do nothing.” — Dave Meyer [29:00]
- Distress Indicators:
- Delinquencies: Up 16 basis points year-over-year (now near 2019 “normal” levels).
- FHA/VA Loan Delinquencies: Up after pandemic moratoria ended; not at emergency level, but worth monitoring.
- Foreclosures: Up 6% year-over-year, but from pandemic-low bases. Encouragingly, foreclosure starts are actually down 10% YOY.
Quote:
“So is there stress in the market? Yeah, there is a little bit more stress than where it was a year ago. But we are not at emergency levels… we are still below pre-pandemic levels.” — Dave Meyer [37:55]
- Bottom Line: Mortgage distress exists, but not at crisis levels—no significant sign of an imminent crash absent a black swan event.
Notable Quotes & Memorable Moments
- “This is the most encouraging sign that we have seen in the housing market for a year, maybe more — maybe three years. Home affordability has hit its best level in two and a half years.” — Dave Meyer [11:00]
- “People are saying, oh my God, people are panic selling. Sellers are flooding the market. No, they are not. That is just objectively not true.” — Dave Meyer [17:20]
- “If you want to understand how far the market might fall … you need to look at distress … Because distress — foreclosures, delinquencies — matter a lot when prices start to go down.” — Dave Meyer [26:55]
- “Broadly speaking, American homeowners and investors are paying their mortgages and that is the best sign that we have for stability in the housing market.” — Dave Meyer [39:25]
Timestamps of Important Segments
- 00:00–04:00: 2025 in review; price appreciation and regional disparities.
- 04:00–09:50: Mortgage rates’ decline, refinancing, market implications.
- 10:52–14:40: Home affordability improvement analysis.
- 14:40–22:40: Seller behavior: delistings, inventory, and logical seller strategies.
- 27:39–39:55: Market stress: underwater mortgages, delinquencies, foreclosures and their implications.
Tone and Takeaways
Dave Meyer strikes a calm, data-driven tone, repeatedly debunking crash hysteria and replacing sensationalism with nuanced market analysis. He emphasizes that while some negative indicators exist—like regional corrections and slight upticks in distress—they are typical of a market correction and not a crash. Key to his message are the slowly improving affordability, stable nationwide home prices, and sellers’ willingness to wait out tough markets by delisting, all of which grant the market stability heading into 2026.
Summary by BiggerPockets Real Estate Podcast—December 2025 Housing Market Update, hosted by Dave Meyer.