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U.S. Home Sales Plummet to 30-Year Low by 2025

7/25/2025

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Summary

Home Sales Decline

U.S. home sales are projected to hit a 30-year low by 2025, driven by high mortgage rates averaging 6.7%.
Increasing inventory fails to address affordability issues, limiting buyer participation.
Long Island experienced a 10.6% decline in home sales in Q2 2025, with prices rising 8.2% to a median of $725,000.
Nationally, existing home sales dropped to 3.93 million in June, the lowest since September 2024.

Summary

Canada's Housing Softens

Canada's housing market is softening, with CREA predicting a 3% decline in home sales for 2025.
The Greater Toronto Area reports a 17.4% sales increase since April, yet overall sales are down 4.1% year-over-year.
Economic uncertainty and trade tensions are dampening buyer sentiment, especially in Ontario and British Columbia.
A national average home price drop of 1.7% to $677,368 is expected, with recovery anticipated in 2026.

History

Historical Context

The 2008 financial crisis stemmed from a housing bubble that peaked in 2006, leading to a 30% drop in home prices nationwide. The Federal Reserve's response included slashing interest rates to near-zero to stimulate recovery. Today, high mortgage rates and low home sales reflect ongoing affordability challenges, echoing past economic instability and prompting potential policy shifts in the U.S. and Canada.

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Home Sales Decline

U.S. home sales are projected to hit a 30-year low by 2025, driven by high mortgage rates averaging 6.7%.
Increasing inventory fails to address affordability issues, limiting buyer participation.
Long Island experienced a 10.6% decline in home sales in Q2 2025, with prices rising 8.2% to a median of $725,000.
Nationally, existing home sales dropped to 3.93 million in June, the lowest since September 2024.

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