Homebuyers waiting for the “right” time to enter the market may already be shaping the conditions they’ve been hoping for. According to Zillow’s latest housing report, inventory levels are climbing and home price cuts are increasing—signs of a cooling market with more opportunity for buyers. However, affordability remains a steep hurdle.
Housing Inventory Hits Multi-Year Highs
In June 2025, Zillow reported 1.36 million active listings, the highest since November 2019. This marks a 2.3% increase from May 2025 and a significant 17.2% jump from June 2024. While inventory remains 21% below pre-pandemic levels, Zillow projects it could reach those levels by the end of 2025. The rise in listings, fueled by new construction and more sellers entering the market, is creating a less competitive environment for buyers, with competition at its lowest point for any June since 2018.
However, new listings dropped 10.9% from May to June 2025, reflecting seasonal trends and sellers’ hesitation due to slower sales. June sales were up year-over-year but down 4.9% from May, indicating a cooling pace.
Home Price Cuts Signal Buyer Opportunity
With buyers gaining more options, sellers are adjusting. In June 2025, 26.6% of Zillow’s listings saw price cuts, nearing the all-time high of 27% in September 2022. This suggests sellers are increasingly willing to negotiate to attract buyers in a less frenzied market. Listings are also taking longer to sell, with an average of 19 days on the market before going pending, compared to 15 days in 2024 and 11 days in 2023.
Price cuts are most prevalent in Sun Belt metros, including:
- Denver, CO: 38% of listings with price cuts
- Raleigh, NC: 36%
- Dallas, TX: 35%
- Phoenix, AZ & Nashville, TN: 35% each
A More Balanced Market, But Not for Everyone
Zillow’s report indicates a shift toward a more balanced market. Of the 50 largest U.S. metro areas, 22 were rated as “neutral” in June 2025, meaning neither buyers nor sellers have a clear advantage—up from just 15 neutral markets in May. Markets like New York City, NY, and Minneapolis, MN, remain seller-friendly, while Boston, MA, Atlanta, GA, Miami, FL, and Tampa, FL, now favor buyers.
However, Zillow Senior Economist Kara Ng cautions that this shift doesn’t make the market “easy” for buyers. High home prices and borrowing costs continue to pose significant affordability challenges, particularly for first-time buyers. “The shift to a ‘neutral’ market is significant, but it shouldn’t be mistaken for a universally cool or easy market for buyers,” Ng said. “While negotiating power is more balanced, the affordability crisis remains a high barrier to entry, especially for first-time buyers.”
What Increased Housing Inventory Means for Buyers and Sellers
For buyers, the market is becoming more favorable:
- More choices: Higher inventory means more homes to choose from.
- More time to decide: With listings staying on the market longer, buyers can take their time.
- Stronger bargaining power: Price cuts and less competition give buyers room to negotiate.
For sellers, the landscape is more challenging:
- Price realistically: With more inventory and price cuts, setting a competitive price is crucial.
- Stand out: Highlighting unique features can help listings attract attention.
- Reach a broad audience: Marketing to a wide pool of buyers is essential in a less competitive market.
Summary
As inventory continues to rise and the market tilts toward balance, opportunities are emerging for buyers who can navigate affordability hurdles. Sellers, meanwhile, must adapt to a market where buyers have more leverage. Zillow’s projection that inventory could reach pre-pandemic levels by the end of 2025 suggests the housing market may continue to evolve, potentially easing some pressures for buyers while challenging sellers to refine their strategies.
Are you thinking about buying or selling real estate in the South Florida area? We can help! Contact Natasha at Live South Florida Realty, Inc. today. Also, be sure to download the free Florida Home Search App for your mobile device.
