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, +0.8% YoY
• Northeast: -1.1% MoM, +3.9% 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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WOLF STREET FEATURE: Daily Market Insights by Chris Vermeulen, Chief Investment Officer, TheTechnicalTraders.com.