Prices of condos drop year-over-year, single-family price growth “near zero.” West & South take serious hits.
By Wolf Richter for WOLF STREET.
Demand for existing homes remains crushed, and amid highest supply in years, prices are beginning to bend.
Sales of single-family homes that closed in July ticked up from ultra-low levels to still ultra-low levels, to a seasonally adjusted annual rate of 3.64 million homes, hobbling along the lowest levels since 1995, down by 24% from July 2019 and by 32% from July 2021.
Compared to July 2024 – the worst year since 1995 – sales were up by 0.8%, according to the National Association of Realtors today (historical data from YCharts):
Sales of condos that closed in July ticked up from record-low levels of NAR’s data going back to 2011, to a seasonally adjusted annual rate of 370,000 condos, down by 36% from July 2019, (historical data from YCharts):
Lots of supply.
Supply of single-family homes has been shooting higher for the past two years and in July remained at 4.5 months, same as in June, and both matched the supply in Lockdown May 2020 when closed sales had collapsed, and both were the highest supply since mid-2016 (historical data from YCharts).
Supply of condos dipped to 6.3 months in July. Over the past three months, supply was the highest since the end of the Housing Bust in 2012 (historical data from YCharts):
What has happened is that prices exploded through mid-2022 beyond what the market can bear, and this price explosion has crushed demand, and as sales plunged while inventories ballooned, months’ supply at the current rate of sales has been shooting higher since 2022.
The spike in supply of homes for sale this year has destroyed the real-estate industry hype that there’s a “housing shortage,” which they deployed liberally – and still in the media these days – to incite homebuyers to pay these too-high prices.
Prices begin to bend.
The national median price of single-family homes, townhouses, condos, and co-ops combined dropped sharply in July from June, reducing the year-over-year gain to just 0.2%, as Condo prices fell year-over-year (-1.2%), while single-family home prices whittled down their gain to just 0.3%.
“Near-zero [year-over-year] growth in home prices suggests that roughly half the country is experiencing price reductions,” the NAR said in the report.
Yes maybe, for single-family homes, where the median price growth was “near-zero.”
But the median condo price growth was negative, it fell year-over-year, as condos in much of the US are getting hammered.
The median price of single-family homes fell 2.3% in July from June, a larger than typical decline, to $428,500, cutting the year-over-year gain to just 0.3%.
But prices fell year-over-year in the West and in the South. Single-family home prices by region, month-over-month (MoM) and year-over-year (YoY):
- West: -1.2% MoM, -1.2% YoY
- South: -1.7% MoM, -0.3% YoY
- Midwest: -6.5% MoM, +3.9% YoY
- Northeast: -1.1% MoM, +0.8% YoY
Home prices are beginning to respond to the mix of desperately low demand, high levels of supply, and prices that had exploded.
Demand has plunged since 2022 because prices had exploded by 45% in the three years from June 2019 through June 2022, according to the NAR’s national median price. This price explosion was a phenomenon of the Free-Money era, but those prices don’t make economic sense, and demand has wilted. Prices eventually fix demand problems – that’s what markets are for. But housing is a slow-moving market.
The median price of condos and co-ops plunged by 3.1% in July from June, to $362,600, which caused the year-over-year comparison to flip to a drop of -1.2%.
Condo prices are getting crushed in the West (-6.6% YoY) and in the South (-5.3% YoY). By region, month-over-month (MoM) and year-over-year (YoY):
- West: -4.9% MoM, -6.6% YoY
- South: -1.7% MoM, -5.3% YoY
- Northeast: -3.7% MoM, +0.9% YoY
- Midwest: -0.9% MoM, +3.2% YoY
In many cities, a condo bust is already in process: condo prices have dropped by 12% to 26% in these 21 bigger cities: Oakland, Austin, San Francisco, Denver, Tampa, Seattle, New York City, Saint Petersburg, Fort Myers, Sarasota, Boise, Jacksonville, Detroit, New Orleans, Portland, Arlington, Naples, Mesa, Aurora, Reno, and Scottsdale.
In some other markets, prices were still near their highs, or edged higher still. But the price declines in many markets overpowered the price increases in others, which caused the big drop in July and the flip into the negative year over year.
This is what the condo bust in Oakland looks like: Condo prices fell month-to-month by 1.8% for the third month in a row in July, are down by 11.4% year-over-year, and by 26% from the peak in May 2022. They are back where they’d been nearly 10 years ago:
And in case you missed it: The Most Splendid Housing Bubbles in America, July 2025: The Price Drops & Gains in 33 Large Expensive Metros
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Buying a condo is a total disaster now. Its not even the price or mortgage rate, its the HOA and property taxes terrors that come with it. Easily can be higher than the principal and interest payment and no regulations (with few exceptions) how high they can be.
I think HOAs have their uses, but need to be reigned in. There’s no reason that an HOA payment should be approaching towards a X percentage value of the value of the property itself.
The 2024/2025 Minnesota Legislature began with bipartisan support for an HOA Reform Act. It passed in the Senate on 6 May; then went to the House.
82% of all the State’s new homes have HOA membership requirements for new owners. 82 percent!
Three of the Senate’s provisions were to:
1) Require HOA boards or property managers to get three written bids for all repair jobs costing $50,000 or more.
2) It would block cities from requiring that there must be an HOA as a condition for approving any housing development within the municipality.
3) It would provide a path for dissolving some of Minnesota’s HOAs; particularly those within single-family detached communities that have no shared property, like a community center or a pool.
To me, #3 should be a slam-dunk.
But as the Legislative session neared its closing date and the House took up the Bill, the HOA Associations went into overdrive to defeat it. One after another, HOA managers and administrators testified about all the horrors that this would create for their power structures.
Nope, the House shut it down at the last minute. Nothing changed. HOAs have arbitrary power that is unchecked.
So, as I commented a few days ago about Minneapolis having nice starter homes for around $300k, I should have added that the 100 year old homes, such as my Sears Craftsman 2 br bungalow kit-built house, have no F ing HOA to pay for or deal with!
Thank you for this report, Wolf. From what I read in it, perhaps it would be wise to wait it out a little while longer before buying, eh?
Good luck everybody . .
People need to stand up and be very vocal about HOA overreach.
During the COVID insanity, my HOA, despite their own bylaws saying the could not discriminate against anyone for anything, and against HPPA laws, was going to require all residents who used HOA facilities to be “vaccinated”. By that time I was already a 2x “survivor” without any jabs.
I had personally told the president he had two choices: pass this insanity & give me back my dues for the year, or I would sue the Board and the members individually for overstepping their rights and violating mine.
I went to a public meeting, conveniently held at s time most residents would not be there, and they made it the last item on the agenda after a discussion of … dog poop. Three hours wait to promote my position.
A week later they had a Zoom board meeting where residents could listen in, but not participate vocally. However you could text in. Every time one of these power hungry ninnies advocated for this illegal position, I texted in “You are coming dangerously close to getting sued. Think long and hard about violating your own bylaws.”
In the end it failed by one vote.
And yes, I was 100% prepared to sue them all. Plenty of free cash flow to do it as well.
If you don’t stand up for what’s right, the know-it-all control freaks will make your life a living hell.
Just say NO.
HOAs, even in condos where they are pretty much necessary, have gotten out of control. In major cities, fees of $1/sf/month are quite common. So your typical 1BR is going to run $500-1000 in HOA fees (on top of mortgage, and whatever utilities aren’t covered).
I wonder if this is the same for co-ops? NYC has a lot of co-ops, some in expensive locations in Manhattan. How “at risk” are these higher end properties?
The data here includes co-ops, but doesn’t split out co-ops from condos.
Nice summary on this topic! Condo Schmondo.
Permeating all of this, as player972 mentioned “property tax terror” is a real issue, not to mention homeowner insurance which has also escalated a significant amount in recent years (Wolf, where does homeowner insurance stack in your “services” inflation data, or is it in a separate data stack?) Will leave the HOA fiasco to others to comment.
PITI + HOA + PMI (for some) has increasingly become burdensome.
Homeowner insurance, HOA fees, and other expenses of homeownership in CPI are supposed to be reflected indirectly in the CPI for Owners Equivalent of Rent (OER), which accounts for about 25% of total CPI, but it’s not a very good approximation:
More detail here, scroll down to OER:
https://wolfstreet.com/2025/08/12/feds-nightmare-cpi-inflation-in-core-services-worst-in-6-months-pushing-core-cpi-to-worst-in-6-months-some-goods-prices-fell-others-rose/
Clarification helpful based on how it’s defined by the data source. Agree as a component of OER it may not provide needed isolation for these costs to be effectively reported/tracked. Thank you, Sir!
I think no matter how you calculate it residential home ownership is a PITA.
Agree, similar to children.
@Bob B you are correct that the ownership of real estate (like the ownership of a car) is a PITA but it is less of a PITA than sleeping in the park or renting a home (or taking the bus or riding your bike)…
Are there any credible price forecasts? The scenarios i’d love to see simulated would be with 0, 150, 300 basis point drop in 2026.
( Assuming this is not wolf’s jam given none of us have a crystal ball and the messy political climate )
It’s completely by city, but in the bigger picture the ultra-rich will start buying up every available asset again if the Fed cuts short term rates in a month. The big boys are no longer going to be comfortable parking their boatloads of money in MM’s and other short-term investments if they are returning 3% when inflation is hovering around that number.
As an extra bonus, the Fed will blow out long-term rates when they cut prematurely and mortgage rates will go up, not down.
The fed cutting rates without inflation getting down to the target will be an absolute disaster for regular folks trying to buy a house to actually, you know, live in.
How this all intersects with the upcoming AI crash debacle will be interesting.
That very last graph (Oakland) showing Housing Bubble 1 and Housing Bubble 2 looks like a humpback whale beside a dolphin. ‘ They’ created a veritable monster this time around! 🐋
“Sales of Existing Single-Family Homes Crushed..”
Crushed, squashed, decimated, annihilated, obliterated, wiped out, eviscerated. Help me out here….
I wouldn’t want to be a real estate agent at this point in time. Bottom line: Housing market is BROKEN. Yes, BROKEN.
Prices are still too high relative to incomes. The sellers are not motivated enough yet, and they can hold out until inflation reduces the actual price they receive in real terms, which is happening to some extent already. Of course, by the time the properties sell, the owner will have paid additional overhead in taxes, maintenance, HOA etc. So the price paid in real terms will be less and the costs associated with holding the property will accrue.
I have tried using “AI” to help me decide if it would be a good time to buy a house and what price I should pay, but so far it hasn’t been very helpful. Something about “Insufficient data to train the model on today’s current housing market, pricing, and interest rates to make a highly probable recommendation. Considering buying bitcoin. “
On the other hand my Magic 8 Ball is knocking it out of the park..
“Should I buy a new home?”
Response “It is Decidely So”
;)
Can’t tell if this meant to be facious or not, but AI isn’t AI. These LLMs are just good at writing and it’s technically machine learning. They cannot think or problem solve. What they can do it write and summarize data far better than an Google search for any content that already exists.
You could build a model and train it to try to forecast real estate price movements, would still also be machine learning and not AI, but that’s not available to the public via chat gpt or Gemini.
What used to be called machine learning is called AI. What used to be called AI is now AGI. We’re still very far from something that can actually think. What we have is something that is really good at repetitive tasks and consolidating/summarizing pre-existing information
Exactly. You can’t get any new knowledge. Only refined existing knowledge that was used to train the model.
I think, like all Real Estate, it’s about location, location, location.
In 2023 we sold our Chicago West Suburban SFR and bought an even further Chicago West Suburban condo.
So far … so good.
But as an attorney buddy of mine, who has now met his maker, would joke …
Q: What’s the difference between an STD and a Condo?
A: You can get rid of an STD.
With any luck we’ll be so out of it … the kids will have to worry about it.
The warning signs the AI bubble is about to burst
Shock sell-off after study warns most investments in artificial intelligence get zero returns
We may be facing the dotcom bubble 2.0
As US tech stocks lose $1 trillion, we must remember that overhyped tech can cause catastrophe
Yeah it will be interesting to see which pops first. I think we can have a housing market decline without a stock market decline, i.e. minimal impact from a housing bubble. However, I think a stock market decline could cause a significant increase in housing prices declines.
If the Fed cuts rates in Sept the long term bond market will crash like it did just before the last election. Mortgage rate will go up. You can say goodby to the Real Estate market. It will go from a recession to a depression.
Our Great Leader has commanded that interest rates be lowered. So it shall be done in accordance with his wisdom about everything.
What politicians dont want lower rates?
And if it all crashes anytime soon, who has been set up as the “fall guy”? Powell
Frankly it’s smart marketing.
Perhaps so the bond market freaks out and his companies can buy things for cheap.
Or he secretly doesn’t want rate cuts, he just wants someone to blame if there’s negative press re: housing market or economy.
I haven’t figured out which yet. But I in no way believe that he actually wants to cut rates to reduce real estate costs. He’s a sales man, he’s trying to sell a concept to America – the question is why? What’s his angle?
“What’s his angle?”
Near term profits.
Median prices for SFH:
Midwest: -6.5% MoM, +0.8% YoY
—————————————
Is there a typo mistake here?
I hope not…
No, it’s not a typo. This -6.5% is month-over-month, and there is always a big drop in July from June, so there is a lot of seasonality in it. But this was a bigger MoM drop than normal, and it did shave down the YoY gain to just 0.8%.
The asking price exceeds the offering price by a substantial amount. The logical conclusion is that the current human population seems to be confused by the concept of delusion.
The buyers are going to win this one.