As we move into fall, the real estate market continues to shift in response to interest rates, inventory dynamics, and evolving buyer preferences. Whether you’re buying, selling, or just keeping an eye on trends, these are the key developments shaping the market this month.
🔍 Major Trends & Market Drivers
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Builders Are Cutting Prices on New Homes
Nearly 40% of builders are now offering price cuts on new homes—the highest since mid-2020—as many properties sit unsold and affordability remains a major constraint. These price drops average around 5%. MarketWatch -
Smaller Homes Are Growing in Popularity
The trend away from large luxury homes is becoming more pronounced. Median new home size in the U.S. has dropped to about 2,210 sq ft in 2025, down from 2,500 sq ft in 2015. Buyers including empty-nesters, retirees, singles, and child-free households are driving demand for smaller, easier-to-maintain homes. The Washington Post -
Buyers Gaining Leverage
As inventory rises and homes linger longer on the market, buyers are finding more negotiating power. Sellers are increasingly reducing prices or being more flexible. New Orleans CityBusiness+2Realtor+2 -
Affordability Easing—Slowly
Mortgage rates have eased somewhat from peaks, and home-price growth is flattening, offering small relief to purchasers. However, even with this improvement, many homes remain beyond what many first-time buyers can comfortably afford. Fortune+2Cotality+2 -
Housing Market Value Reaches a New Record, But Not Equally Everywhere
The total U.S. housing market is now valued at about $55.1 trillion, up around $20 trillion since 2020. But not all states are seeing gains—Florida, California, and Texas have all lost housing market value over the past year. Zillow MediaRoom -
Market Anxiety is High
A recent report shows that 60% of homeowners and prospective buyers feel uncertain about market conditions—this is a three-year high. Many are waiting on the sidelines because they expect interest rates and home prices to decline further before making a move. Inman
🏘 Regional & Segment Highlights
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San Francisco: Inventory remains tight, especially in the single-family home sector. Condos are sitting longer on the market. The overall market remains a seller’s market in many parts. helmrealestate.com
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Toronto / GTA: Prices are down substantially from their peaks. For example, detached home prices in the region dropped about 27% from the February 2022 high. Move Smartly+1
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Vacation / Seasonal Markets: Sales in vacation towns are falling; inquiries are weaker. Prices in some of these markets are flattening. Redfin
✍ What This Means If You’re Buying or Selling
| If You’re a Buyer | If You’re a Seller |
|---|---|
| You may get more negotiating room: look for sellers who are motivated and properties that have been listed longer. | Pricing is more delicate: overpricing can lead to your home sitting too long. Be realistic and consider incentives or staging. |
| Check out new-construction homes; with price cuts, they might be more competitive than resale homes in some areas. | Focus on curb appeal and move-in readiness—“ready now” homes are more attractive in current conditions. |
| Explore smaller or mid-size homes or those in less expensive submarkets if affordability is key. | Be aware that excess inventory in some areas can dampen your leverage. Knowing your local market is essential. |