The dream of homeownership in the U.S. remains out of reach for many Americans, with home prices staying high and mortgage rates hovering near 7%. According to the June 2025 Monthly Housing Market Trends report by Realtor.com®, the total number of unsold homes, including those under contract, has risen by 20% compared to the same time last year. This increase highlights the ongoing strain in the housing market, offering buyers more choices but also presenting greater financial challenges.
Economists at the National Association of Realtors® (NAR) argue that if the 30-year fixed mortgage rate were to drop to 6%, it would make the median-priced home affordable for an additional 5.5 million households— including 1.6 million renters. NAR’s survey suggests that about 10% of these households (around 550,000 families) might consider purchasing a home within the next 12 to 18 months if mortgage rates were to fall to that level.
However, despite these promising figures, many potential buyers remain hesitant. Renowned real estate agent Alexei Morgado shared that his clients often express an interest in buying a home, but high mortgage rates are preventing them from taking the leap. "It’s not just about the numbers," Morgado says. "What I hear most often is the fear of making a bad decision, getting into something they can’t sustain, or rushing into a purchase that they’ll regret later." Many buyers are frustrated by the prospect of paying more for the same property, which leads to a sense of discouragement and puts their plans on hold.
Meanwhile, the supply and demand dynamics in the housing market have shifted. With interest rates staying high, the demand for homes has been more suppressed than last year. Although home prices have slowed in their rate of increase, they are still rising. NAR forecasts that national home prices will rise by approximately 1% this year, but will accelerate to a 4% increase by 2026.
Certain U.S. cities are expected to see a significant uptick in home sales if mortgage rates drop to 6%. Cities like Atlanta, Dallas, Minneapolis, Cleveland, and Kansas City, MO-KS, are among the top markets that would benefit from this mortgage rate reduction. According to NAR’s forecast, these metros would experience a 14% increase in home sales if mortgage rates decreased to 6%.
For example, in June 2025, the median list price in Atlanta was $421,000, with homes staying on the market for an average of 51 days. Cleveland, on the other hand, had a much lower median list price of $277,000, with homes typically staying on the market for 37 days. Dallas saw a median list price of $440,000, with homes lingering on the market for an average of 50 days.
In Kansas City, the median list price was $409,475, with an average market stay of 45 days. Meanwhile, in Minneapolis, the median list price stood at $447,900, with homes remaining on the market for 37 days.
While high mortgage rates continue to dampen buyer activity, the rising inventory of homes for sale gives buyers more options and greater bargaining power. The increase in housing inventory allows potential buyers to take their time and weigh their options, something that was not possible during the heated markets of previous years.
Many real estate analysts believe that as interest rates remain high, non-essential buyers have withdrawn from the market, leaving those who are serious about purchasing with more room for negotiation.
However, NAR also warns that buyers waiting for rates to drop might miss out on valuable opportunities. With housing inventories increasing across the country, buyers now have more choices and could find better deals than in recent years.
Even though home prices continue to rise, entering the market now may allow buyers to secure a more competitive price through negotiations. In some regions, the housing market remains resilient, and many homeowners are continuing to accumulate wealth through real estate.
For example, in Phoenix, NAR data reveals that homeowners gained an average of $320,860 in equity over ten years of ownership—wealth that non-homeowners are missing out on. This underscores the financial benefits of owning real estate, making it an important avenue for wealth creation for many Americans.
However, whether it is the right time to buy depends largely on an individual’s situation. Lawrence Yun, NAR’s chief economist, states that real estate net worth remains stable, thanks to low delinquency rates and even lower foreclosure rates, strengthening the financial standing of homeowners. In other words, buying into the real estate market can still be a valuable wealth-building opportunity for those who are in a position to do so.
Morgado adds that the most important thing for potential homebuyers is to enter the market with a realistic strategy that suits their financial situation. "I always tell my clients that the key is to enter the market with a strategy that feels achievable," Morgado advises. "Figure out what you can afford without compromising your peace of mind."
As the U.S. housing market continues to evolve, homebuyers must make careful, informed decisions. High mortgage rates, rising home prices, and an uncertain economic outlook make homebuying a challenging prospect for many.
Whether waiting for lower rates or jumping into the market now, the crucial factor is to develop a clear financial plan and purchase strategy—one that ensures buyers are not taking unnecessary risks while also not letting valuable opportunities pass them by.