U.S. Housing Market Shows Modest Improvement Amid Ongoing Affordability Challenges

The United States Census Bureau and Department of Housing and Urban Development released July 2025 data showing that housing starts rose to 1.428 million units annualized.

This figure exceeds June and June 2024 levels, as housing starts grew 5.2 percent month-on-month and 12.9 percent year-over-year. Meanwhile, building permits slipped to 1.354 million units, down 2.8 percent from June and 5.7 percent from July last year.

Housing completions climbed to 1.415 million, up 6.0 percent from June but still down 13.5 percent annually. New home sales dipped slightly in July. The Census Bureau and HUD reported a seasonally adjusted annual rate of 652,000 new single-family sales.

That number fell 0.6 percent from June and 8.2 percent from July 2024. The inventory of new houses available rose to 499,000 units, yielding 9.2 months of supply—unchanged from June and up from 7.9 months a year earlier.

Existing-home sales also edged upward. The National Association of Realtors recorded a 2.0 percent monthly increase to 4.01 million units annualized. That surpasses June and reflects a 0.8 percent gain year-on-year.

The median existing-home price hit $422,400, the highest for July on record although its year-over-year increase slowed to 0.2 percent. Inventory grew to 1.55 million units, representing a 4.6-month supply, the largest total since May 2020.

These figures tell a balanced story. Homebuilders start more properties and complete more units, while permitting softens. New home sales remain sluggish and inventory stays elevated.

Existing-home sales rise very gradually amid high prices and persistent mortgage rate pressure. From a mercantile standpoint, builders increase activity but still face excess supply and weak demand.

Buyers gain more choices, yet affordability remains tight. Policymakers and market actors should note that supply continues to outstrip demand, even as construction firms see modest momentum.

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