Bright MLS: Housing market shifts toward necessity, balance

The U.S. housing market is entering a new phase defined less by competitive bidding and more by financial stress and practical necessity, according to a second-quarter Bright MLS agent survey released Friday.

The findings reveal a marked departure from previous years’ demand-driven trends, with both home buyers and sellers increasingly motivated — or discouraged — by broader economic uncertainty rather than pricing or mortgage rates alone.

“The survey revealed an important shift: people aren’t just stepping back because of mortgage rates or home prices any longer,” said Lisa Sturtevant, chief economist at Bright MLS. “They’re pausing because of broader economic anxiety and financial pressure. It’s no longer just about affordability — it’s about stability.”

Buyers step back amid financial anxiety

The survey, which gathered responses from real estate professionals across Bright’s footprint in Q2 2025, found that nearly 75% of agents had buyers pause their home search — an increase from less than two-thirds in Q2 2024.

Unlike previous years, fewer buyers are pulling back due to failed offers (down to 32% from 56.2%) and more due to economic uncertainty (32.8%) and financial instability (18.1%).

First-time buyer activity also hit a low point, with only 37.4% of agents reporting working with first-timers in June — Bright’s lowest figure since launching the survey in early 2023.

Home purchases are increasingly driven by life changes, not preference. The share of buyers motivated by family reasons jumped to 20.5%, while job relocations rose to 12.3%.

Meanwhile, buyers “tired of renting” declined to 26%, and investment purchases fell to 13.2%.

“It’s a far more practical, needs-based market today,” Sturtevant said. “People are making moves because they have to, not necessarily because they want to.”

Sellers adjust, expectations shift

On the seller side, the data shows a retreat when pricing expectations aren’t met — now the leading reason listings are pulled.

Nearly 20% of agents said clients paused selling due to unsatisfactory offers, up from 16% in 2024. Reluctance to give up low mortgage rates and concerns about finding a new home are now far less common reasons to delay.

Despite these shifts, the overall number of would-be sellers holding back remained stable: 35% of agents reported at least one client opted not to sell, a marginal rise from 34% last year.

Market moves toward equilibrium

For the first time in more than two years, seller activity is projected to surpass buyer activity, based on Bright’s proprietary Buyer and Seller Indexes.

In July, both indexes hovered near 50 — a signal of emerging balance. In contrast, one year ago, buyer activity was significantly higher (60) while seller activity lagged (23).

“We’re entering a phase where home prices could soften further, and in some local markets in our footprint, prices are very likely to decline year-over-year,” Sturtevant added. “Buyers who remain active will have more leverage than they’ve had in years, and sellers will need to price competitively to attract offers.”