AUSTIN, TX — The U.S. housing market has surpassed a key inventory milestone with over 1 million active listings in May 2025, marking the first time since Winter 2019 that inventory levels have reached this height. However, recovery remains uneven, with significant regional disparities highlighted in Realtor.com®’s May Monthly Housing Trends Report.
“The number of homes for sale is growing and even hit a key milestone in May,” said Danielle Hale, Chief Economist at Realtor.com®. “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.”
Regions in the South and West lead the recovery. Cities like Denver, Colorado (+100.0%), Austin, Texas (+69.0%), and Seattle, Washington (+60.9%) have seen inventory rebound thanks to increased construction activity. Conversely, areas such as Hartford, Connecticut (-77.7%), Chicago, Illinois (-59.3%), and Virginia Beach, Virginia (-56.7%) remain well below pre-pandemic levels, reflecting a slower rebound in the Northeast and Midwest.
“More homes on the market means buyers finally have options and leverage they haven’t had in years,” noted Gary Ashton, founder of The Ashton Real Estate Group of RE/MAX Advantage in Nashville. “But the strategy for buyers and their agents this spring largely depends on where you live.” He added that in areas like Nashville, where supply has increased, sellers may need to reduce prices or offer concessions to attract buyers.
Despite the inventory boost, a cooling home buying season is evident. The median days on the market increased by six compared to last year, reaching 51 days, while 19.1% of listings featured price reductions, the highest May share since at least 2016. The West and South saw the steepest price cuts in metros including Phoenix, Arizona (31.3%), Tampa, Florida (29.9%), and Denver, Colorado (29.4%).
A clear connection between new construction activity during the pandemic and current inventory conditions was identified. Metros with higher new construction rates, like Austin and Denver, have generally returned to pre-pandemic inventory levels. Meanwhile, regions with less construction, such as Boston and Buffalo, continue to struggle with supply shortages.
Hale emphasized that addressing the nationwide housing shortfall of nearly 4 million homes will require changes to zoning, permitting, and construction incentives to bridge the gap and prevent further inequalities in inventory recovery across the country.
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