Escrow Agencies and Other Real Estate Services NAICS 531390

Oct 21, 2025 - Homebuilders Cautiously Optimistic

• Home builder confidence in the single-family market improved in October but remained solidly in negative territory, according to the National Association of Home Builders (NAHB). Home builder sentiment, as measured by the NAHB/Wells Fargo Housing Market Index (HMI), rose five points to 37 in October 2025 compared to September's reading of 32. Any HMI reading over 50 indicates that more builders see conditions as good than poor. October's HMI marked the highest reading since April 2025. Builders are cautiously optimistic as the average for a 30-year fixed-rate mortgage dropped to 6.3%, and the Federal Reserve is expected to ease interest rates further later in the year. However, the housing market remains challenging as many would-be buyers stay on the sidelines waiting for lower mortgage rates.
• Compass’s $1.6 billion acquisition of Anywhere Real Estate will create the largest U.S. brokerage by agent count, expanding its network to over 200,000 agents, according to The Wall Street Journal. The merger strengthens Compass’s push for private listings; homes that are marketed exclusively to its agents and clients before public release. While Compass argues this gives sellers more control and privacy, critics warn it reduces market transparency. The deal, expected to close in 2026, reflects broader industry consolidation amid sluggish home sales and declining revenues. Compass and Anywhere (holdings include the Century 21, Sotheby's, and Coldwell Banker brokerage brands) have a combined market share of 18%. However, real estate consulting firm RTC Consulting estimates that in luxury markets like New York and San Francisco, the combined share could exceed 40%, raising potential regulatory concerns.

• Corporate lessors of single-family homes face mounting pressure from “accidental landlords” renting out their homes when they're unable to sell, according to The Wall Street Journal. The dynamic is depressing rent growth, with top U.S. markets projected to rise just 0.8% this year, the slowest pace since 2011, according to John Burns Research & Consulting. Oversupply in some Sunbelt markets, where institutional portfolios are heavily concentrated, is driving down rents for new leases. Companies like Invitation Homes are offsetting losses by raising rents for existing tenants, but widening rent gaps may increase turnover. With nearly two million unsold homes on the market, and 2.3% of listings shifting to rentals, inventory seeping from sales to rentals is reshaping the rental landscape. Despite strong occupancy and retention, corporate landlords are underperforming the broader market, signaling challenges ahead in a housing environment marked by stalled transaction activity.
• So far in 2025, small investors are playing an outsized role in the U.S. single-family housing market, according to The Wall Street Journal. In the first half of 2025, small investors accounted for about 25% of home purchases, outpacing large institutional buyers, according to property analytics firm Cotality. While traditional home buyers remain sidelined by high home prices and interest rates, small investors are capitalizing on seller incentives. Unlike large firms constrained by institutional reporting, smaller investors can take greater risks and are increasingly targeting mid-priced homes to renovate and rent.