Active home inventory has improved over the past year, with recent data from the ResiClub blog showing a 24.6% increase from January 2024 to January 2025. Although inventory levels in the U.S. are more than 25% below 2019 levels, the January year-over-year increase could give homebuyers a leg up throughout the remainder of 2025. Additionally, if inventory continues on its current upward trajectory, there would be 993,183 active listings come January 2026 and 1.16 million active listings by January 2027. This improvement is taking place across the nation, but particularly in the Sun Belt and Mountain West regions.
One factor is that some pockets of the Sun Belt and Mountain West experienced even greater home price growth during the Pandemic Housing Boom, which stretched fundamentals too far beyond local incomes. Once pandemic-fueled migration slowed, and rates spiked, it became an issue in places like Colorado Springs and Austin.
Unlike many Sun Belt housing markets, many Northeast and Midwest markets have lower levels of homebuilding. As new supply becomes available in Southwest and Southeast markets, and builders use affordability adjustments like buydowns to move it, it has created a cooling effect in the resale market. The Northeast and Midwest don’t have that same level of new supply, so resale/existing homes are pretty much the only game in town. Read more