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U.S. housing inventory hit a high point in May 2025, exceeding 1 million for the first time since the winter of 2019, prior to the COVID-19 pandemic. However, the recovery has not come equally across all regions, with the Northeast and Midwest continuing to struggle in growing supply, according to a report released Thursday by Realtor.com.
Danielle Hale | Credit: Realtor.com
“The number of homes for sale is growing, and even hit a key milestone in May, with more than a million active listings,” said Realtor.com Chief Economist Danielle Hale.
“But not every housing market is equally well-supplied. Recent construction trends explain a lot of the variation in recovery that we see across markets. Many markets that built aggressively during and after the pandemic are now seeing more listings, longer time on market, and even some modest price softening. In contrast, markets that didn’t build as many homes are still facing an acute shortage, which continues to prop up prices and limit buyer options.”
While all 50 of the largest metro areas in the country saw annual inventory gains in May 2025, only 22 of those metros, all located in the South or West, returned to pre-pandemic levels. Those cities that saw a surge in construction after 2020, including Denver, Colorado (up 100 percent from pre-pandemic); Austin, Texas (up 69 percent); and Seattle, Washington (up 60.9 percent), are the ones that have posted the greatest gains. Meanwhile, Hartford, Connecticut (down 77.7 percent from pre-pandemic) and Chicago, Illinois (down 59.3 percent) continue to struggle to grow inventory.
Gary Ashton | Credit: RE/MAX Advantage
“More homes on the market means buyers finally have options and leverage they haven’t had in years,” Gary Ashton of The Ashton Real Estate Group at RE/MAX Advantage in Nashville said in the report. “But the strategy for buyers and their agents this spring largely depends on where you live. In Southern locales, like Nashville, the average sales price has increased by 3 percent as homes remain on the market for longer and local supply increases. We can expect to see sellers get creative with offering concessions to buyers and start to consider more price reductions.”
Homebuyers may have more inventory this year, but it isn’t necessarily drawing them into the market because of barriers to affordability. As a result, the market this spring is a bit more sluggish, with homes spending a median 51 days on market, up by six days from last year. Price cuts also rose to about 19 percent of active listings in May 2025, up 2.4 percent year over year, and the highest share of price cuts in any May since at least 2016.
The most severe price cuts were seen in the West and South, particularly in Phoenix, Arizona (31.3 percent of active listings saw price cuts); Tampa, Florida (29.2 percent); and Denver, Colorado (29.4 percent).
Realtor.com’s report found that there was a direct link between those metro areas that continued building during the pandemic and those that did not. Austin, Nashville and Denver, all of which saw pandemic building booms, have largely rebounded to pre-2020 inventory levels, the real estate company reported, while those that built less during the pandemic, including New York City, Boston and Buffalo, New York, still lag behind in inventory.
