The U.S. housing market saw a significant shift in favor of buyers by the end of last year, as the growing gap between supply and demand reached levels not seen in more than a decade.
In December 2025, the number of sellers nationwide exceeded the number of buyers by 47.1%, equivalent to roughly 631,500 additional sellers, marking the largest market imbalance since data recording began in 2013.
The gap widened at an accelerating pace, rising by 7.1 percentage points compared to November—the largest monthly increase since September 2022—and up 22.2 percentage points from the previous year.
According to real estate sector definitions, the market has been clearly tilting in favor of buyers since May 2024. A buyer’s market is defined when the number of sellers exceeds buyers by more than 10%, whereas a seller’s market is the opposite. A balanced market occurs when the numbers are roughly equal.
When supply surpasses demand, the negotiating power shifts to buyers, who can choose what suits them and seek discounts. This situation now dominates large parts of the country. However, changes in affordability mean these benefits are available only to households able to handle current prices and high mortgage rates.
Rising housing costs, combined with higher financing expenses and general economic uncertainty, have pushed many potential buyers out of the market, leaving sellers to compete in a weak-demand environment.
Connie Durnal, a real estate agent with Redfin Premier in Dallas, noted that some sellers face significant losses due to low demand for homes, which reached record-high inventory levels this year.
For example, one of her clients purchased a home at a high price during the pandemic peak and is now facing a 10% loss. Despite being aware of the market shift, many sellers still refuse to accept this reality, causing unrealistically priced homes to remain on the market for extended periods.
Demand Declines Faster Than Supply
The shift toward a buyer’s market is primarily due to a sharp drop in demand. The number of active buyers fell 5.9% in December compared to the previous month, reaching around 1.34 million people—the largest monthly decline since March 2023 and the lowest level since data recording began in 2013.
On the supply side, the number of homes for sale decreased by a lower monthly rate of 1.1%, reaching about 1.97 million homes, also the lowest level since February 2025.
