Housing Market Turns: Buyers Surge as Sellers Face Price Reset

With mortgage applications spiking 11% in just one week and rates dipping slightly to 6.84%, America’s housing market is showing signs of reawakening—but not without growing pains.

Homebuyers, many long priced out of the market, are sensing a sliver of opportunity. According to the Mortgage Bankers Association’s (MBA) latest Weekly Applications Survey, purchase activity surged 11% week-over-week, with refinance applications climbing an equal amount. “Conventional purchase application volume increased 13 percent and was up 9 percent from year-ago levels, a surprisingly strong move given lingering economic uncertainty,” said Mike Fratantoni, MBA’s SVP and Chief Economist.

But for sellers, particularly in overheated Sunbelt markets, the landscape is shifting fast. “We are starting to see prices decelerate,” said Jenna Stauffer, Global Real Estate Advisor at Sotheby’s International Realty. “It’s a correction, and it’s healthy. Prices got so out of whack with income levels, people were completely shut out of the housing market.”

Buyers: A Window Opens, But Not Wide

While mortgage rates remain historically high, the 30-year fixed rate declined to 6.84 percent,—they’re down from recent peaks, and many would-be buyers are pouncing. "Borrowers of conventional loans tend to have larger loan sizes and are more apt to be move-up buyers," noted Fratantoni, hinting that the current movement could signal confidence among middle- and upper-tier buyers.

Yet, affordability remains a barrier. Stauffer emphasizes that even small changes in rate or price can be make-or-break for younger buyers: “The median age of the first-time homebuyer is now up to 38. It’s challenging,” she said. “But this market is becoming more buyer-friendly. You just have to get creative in your search”.

Sellers: Time to Rethink Strategy

For homeowners contemplating a sale, especially in states like Florida, Texas, and Arizona, the game is changing. “Inventory is up dramatically in the South,” said Stauffer. “Except for Miami-Dade and Broward, condo prices are already falling. People can’t afford the new fees or the code upgrades, so they’re selling in droves”.

This surge in inventory is putting downward pressure on prices in some metros, even as the Northeast and Midwest see steadier conditions due to supply constraints.

Emotions Running High

For many Americans, the housing market isn’t just an economic metric—it’s personal. It’s the dream of owning, the fear of overpaying, the anxiety of being locked out, or the pride of securing a foothold in a tightening world.

“I hate to tell people to rent,” said Stauffer, a firm advocate of ownership. “Why give money to a landlord when you could be building equity?” Still, she concedes that “it might take time. Consumers are tapped out. They’ve got price fatigue, they’re in debt. But eventually, rates will come down. Just not right away."

What’s Next?

For now, the numbers show cautious optimism. According to the MBA, refinance activity is up 51% from a year ago, indicating that some homeowners are jumping at even minor rate relief. FHA and VA applications also rose, hinting at activity among first-time and lower-income buyers.

But with market correction underway and economic signals mixed—slowing GDP, steady jobs, weak manufacturing—the future remains uncertain. One thing’s for sure: buyers and sellers alike will need patience, strategy, and above all, resilience.