Residential Brokers & Property Managers NAICS 531311, 531210

May 21, 2025 - Spring Home-Buying Season Disappoints

• Industry watchers, buyers, and sellers were hoping for a housing market turnaround this home-buying season, but so far it has been disappointing, according to The Wall Street Journal. Home prices have fallen in some parts of the country, but remain near record highs, which, along with stubbornly high mortgage rates, are keeping some would-be buyers locked out of the market. Some specific markets have plenty of homes for sale, but not much interest from buyers as prices remain high. Many in the real estate market were optimistic that the 2025 buying season would break the logjam after existing home sales in 2023 and 2024 were at the lowest levels since the mid-1990s. Some industry insiders note that housing demand softened further in April after the Trump administration’s tariff policies triggered stock market selloffs and made consumers wary of making big purchases.
• US apartment sales increased 7% year-over-year in the first quarter of 2025, reaching $30 billion, according to MSCI Real Assets and reporting by Multifamily Dive. The rise marked the fourth consecutive quarter of increased apartment sales. Single-property sales saw the most significant growth, rising 39% over Q1 2024 to $25.7 billion. While sales of individual apartment assets have returned to pre-pandemic levels, portfolio and entity-level sales remain below historical norms. Portfolio apartment deals increased 18% in the first quarter of 2025 to $4.4 billion, while there were no entity-level deals in Q1. MSCI noted that while US trade policy news cycles have had a whipsawing effect on public equity and bond markets, the multifamily market rarely reacts to shocks in a single quarter.

• US home builders are dangling more incentives to close deals amid a tepid spring home-buying season that is halfway over, according to The Wall Street Journal. Builders typically notch 40% of their annual sales during the spring, but mortgage rates that are stuck around 7% and a lack of affordability have reduced demand. Builders have increased incentives to bring buyers off the sidelines, including mortgage-rate buydowns, design upgrades, and price cuts. In the first two weeks of April, incentives offered by builders equaled 7.2% of the purchase price, up from 6.1% in January, according to data from John Burns Research & Consulting. Incentives are eating into builder profits during a season that usually sees few discounts, and prices tend to rise.
• The number of building permits issued for single-family, privately-owned housing units, a demand driver for interior design services, decreased 5.1% in April 2025 compared to March and fell 6.2% year-over-year. Single-family housing starts dropped by 1.6% month-over-month and were down 12% compared to April 2024. Single-family housing completions declined 5.9% in April from the previous month and decreased 12.3% year-over-year. Housing starts in April were pressured by tariff-related economic uncertainty, high mortgage rates, and rising costs for building materials, according to the National Association of Home Builders (NAHB).