Mortgage rates are still hovering around 7%. Insurance premiums are climbing. Consumer sentiment is shaky at best. And yet—buyers are writing offers.
In fact, purchase applications are up 20% year-over-year, according to Logan Mohtashami of HousingWire. It’s a sharp turn from where we were two years ago and a clear indicator that today’s buyers aren’t waiting for “perfect conditions.” They’re moving forward—despite the headlines.
So what’s driving this unexpected resilience?
Buyers Have Adjusted to the New Normal
Mohtashami outlines what many of us in the field already sense: while affordability is still a challenge, today’s buyers have recalibrated. They're not expecting 3% interest rates. They’re not panicking over every Fed meeting. And they understand that real estate is still one of the most reliable long-term investments—especially in markets like ours.
Here’s what the data shows:
- 20% year-over-year increase in purchase applications
- Pending home sales last week nationwide:
- 2025: 72,039
- 2024: 68,916
- Total pending sales nationwide:
- 2025: 405,489
- 2024: 395,923
These numbers don’t reflect a cooling market—they reflect one that’s stabilizing.
Inventory Is Up. So Is Opportunity.
This is the healthiest inventory environment we’ve had in years. National active listings just crossed 825,000—up more than 200,000 from the same time last year. In Southwest Colorado, we’re seeing it too: active listings are building sharply, price reductions are becoming more common, and buyers are finally getting the breathing room they’ve been missing.
If you’re a buyer, this matters.
Inventory equals leverage. You have more options. You can negotiate. And for the first time in a while, you may not be competing with a dozen other offers.
What About Home Prices?
Another important data point: nearly 40% of active listings have had a price cut—up from 36% this time last year. This isn’t a crash—it’s a rebalancing.
Mohtashami predicts modest home price growth of 1.77% for 2025, meaning that after inflation, real prices are effectively flat or slightly negative. In other words, this is a market where value is emerging—not disappearing.
Rates May Fall. Competition Will Rise.
Here’s the part most buyers overlook: while rates feel high now, mortgage spreads—the difference between the 10-year Treasury and mortgage rates—have been improving. If those spreads normalize, we could see rates dip later this year.
But when that happens, more buyers will re-enter the market. Competition will increase. Negotiating power will shrink. That’s why savvy buyers are locking in deals now, before the herd returns.
What This Means for You
If you’re a buyer:
Now is not a time to chase headlines. It’s a time to chase opportunity. You can refinance later—but you can’t rewind the market to find this inventory again.
If you’re a seller:
You still have a window—but buyers are smarter and more selective. Pricing matters. Presentation matters. This market rewards those who understand the shift—not those who try to ignore it.
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