Nearly 1 In 4 Sellers Cut Home Prices

While home buyers continue to sit on the sidelines, Zillow's monthly report for June shows that home listings are piling up at a faster pace,  leading sellers to cut down on home prices.

"A growing segment of homes that aren't competitively priced or well marketed are lingering on the market. Sellers are increasingly cutting prices to entice buyers struggling with affordability," said Zillow Chief Economist Skylar Olsen. "For years, the housing market has been defined by fast sales and few options. Now it's starting to look more like it did before the pandemic in terms of competition, if not costs. As the wait for mortgage rate relief drags on, slower price growth and even dips in some areas will help buyers catch up on saving for a down payment."

The total number of homes on the market has risen throughout the year, ticking up 4% from May to June to stand nearly 23% above last year’s low level. Compared to pre pandemic averages, inventory still lags behind by 33%, but that’s the smallest deficit since the fall of 2020 when the pool of available homes began quickly dropping. 

But compared to last year, inventory is higher in all of the 50 largest U.S. metropolitan areas except two — New York and Cleveland — and rose month over month in all but five. 

While attractive listings are still selling quickly, buyers in the market are enjoying a few more days to weigh their choices. Homes sold in June were typically on the market for 15 days before the seller accepted an offer. That's five days shorter than pre-pandemic norms, and the smallest difference since June 2020.

In reaction, sellers are cutting prices more often to entice buyers. Nearly one-quarter of listings (24.5%) received a price cut in June, the highest rate for this time of year in Zillow records dating back to 2018. 

Overall, buyers are still contending with costs that have risen far faster than wages. Median-income households can afford mortgage payments on a typical home in just 11 of 50 major markets when putting 20% down. 

As for homeowners, Zillow’s monthly report finds annual appreciation is a reasonable 3.2% nationally, down from a 2024 peak of 4.6% in March. Monthly growth has decelerated to 0.6% — the slowest June appreciation since 2011. 

Slower home value growth in the months ahead could give struggling buyers a chance to make up ground. Zillow forecasts home values to rise just 1% nationally through June 2025.