General Real Estate News

We need about 420,000 homes on the market that are priced below $255,000 so that households that earn below $75,000 a year can afford a house.

WASHINGTON (May 15, 2025) – U.S. households earning $75,000 a year can only afford 21.2% of home listings as of March 2025 – up slightly from 20.8% a year prior and representing the biggest gain of any income group – demonstrating that the nation’s housing affordability gap persists, according to the National Association of Realtors® and Realtor.com® 2025 Housing Affordability & Supply report.

The report analyzes the shortage of affordable homes across different income levels in the current U.S. housing market. It provides a real-time, income-specific snapshot of housing affordability, examining what home buyers at various income levels can afford based on standard lending criteria.

For-sale housing inventory increased nearly 20% nationwide in March 2025 from one year earlier, and while this gain marks progress, it remains far from pre-pandemic conditions.

“The housing market is at a turning point,” said Nadia Evangelou, NAR senior economist and director of real estate research. “More homes are hitting the market, and it’s encouraging to see the greatest housing-supply gains among middle-income home buyers.”

I don’t see the housing market as being at any kind of a turning point.

There is maybe a little glimmer of hope that one day we will see a balanced housing market that doesn’t favor buyers or sellers. The current market favors sellers as demand remains high and supply remains low.

Here is an infographic from the National Association of Realtors that shows housing supply and demand in the US.  Real estate is local.

From the HUD, Housing and Urban Development web site: “

God blessed us with this great nation, and together, we can increase self-sufficiency and empower Americans to climb the economic ladder toward a brighter future.”

– Secretary Scott Turner

The federal government never runs out of money for tax deductions for homeowners’ mortgage interest. Can you imagine if the IRS said, “No tax deductions for you; we are out of money?” Spending cuts for programs for the poor are another matter.

President Donald Trump’s administration unveiled its 2026 budget proposal, calling for $163 billion in sweeping cuts to nondefense government spending, including multiple federal housing assistance programs affecting homeowners and renters alike.

According to a 46-page discretionary spending request sent by the Office of Management and Budget to the Senate Committee on Appropriations, the Trump administration is looking to slash the budget of the  Department of Housing and Urban Development by $33.6 billion in the next fiscal year.

The lion’s share of the HUD budget reduction, amounting to $26.7 million, will come from the State Rental Assistance Block grant, which provides tenant-based rental assistance, public housing, and housing for the elderly and people with disabilities.

Look for reductions and proposed reductions on any spending that helps the poor. Look for more tax cuts for the wealthy and funding cuts to programs that help the poor.

I expect to see some improvements in year-over-year numbers. Last year was not the best year for home sales in the US.

Pending Home Sales Jumped 6.1% in March

Key Highlights

• Pending home sales in March leapt 6.1%.
• Compared to one month ago, pending home sales declined in the Northeast, while the Midwest, West, and especially the South – underwent increases.
• Year-over-year, contract signings rose in the Midwest. However, the Northeast, South, and West declined, with the biggest drop in the Northeast.

The numbers from NAR are always interesting to me, partly because they show that real estate is local and varies by region.

Yesterday, I noticed two vacant spaces where real estate offices used to be. The National Association of Realtors stopped publishing numbers, so we don’t know how many Realtors there are. We don’t know how many real estate licensees there are either.  There isn’t a shortage, I know that for sure. are more Realtors in the area than there are homes for sale. Home sales have been in a slump for a couple of years due to high interest rates. The houses sell fast enough, but many homeowners have chosen to stay put, which has resulted in fewer homes for sale.

The picture is of the Keller Williams office on West 7th Street.  It was there for about five years and was one of many Keller Williams franchisees in the metro area, but the only one in St. Paul. There was also a real estate office across the street, but that one only lasted a couple of years.  It could just be that West 7th Street near downtown isn’t a good place for a real estate office.

One thing that really surprised me when I started in real estate was how much real estate agents like to work in offices. As independent contractors, I would have thought they would be more independent.

There is a Coldwell Banker Burnet office on Grand Avenue with a for-sale sign in front of it.

The chart uses data from the NorthstarMLS and represents previously owned single-family homes sold in the Twin Cities metro area during the last five years. We can see the jump in home sales in 2021 and 2022. I have seen this before, when many people moved and then home sales slumped for a few years because generally, people do not move all that often.

In this case, mortgage interest rates were much lower when the home buying was happening. People are staying put. Home sales remain low because people are not putting their homes on the market. With all of the chaos and uncertainty created by trade wars and tariffs, I believe home sales will remain low in 2025. When we go into a recession, interest rates may come down but I don’t think that is going to be enough of an incentive for people to want to buy or sell residential real estate.