Winter Freeze: Real Estate Market Sees Sharpest Slowdown in Two Years

Lisa Mailhot  |  January 3, 2025

Buyers

Winter Freeze: Real Estate Market Sees Sharpest Slowdown in Two Years

 

As temperatures dropped over the festive season, so did activity in the real estate market. December 2024 saw the most dramatic seasonal slowdown in two years. According to Realtor.com® senior economist Ralph McLaughlin,

"Homes spent 70 days on the market, the slowest December in five years and the slowest month since January 2023" (Farberov, 2025).

The average home took nine days longer to sell than in December 2023. Inventory also plummeted 8.6% from November, marking the steepest decrease since early 2023. Mortgage rates played a significant role in this glacial pace, hitting 6.85% by late December and discouraging potential buyers from entering the market.

High Mortgage Rates Keep Buyers on the Sidelines

Elevated mortgage rates hovering in the high 6% range since October proved to be a major hurdle. Even with the median listing price declining to $402,502—a $15,000 dip year-over-year—buyers largely stayed put. Sellers also paused, with just 0.9% more homes listed compared to December 2023, a mere 2% dip from November.

However, there’s a glimmer of hope. According to Realtor.com’s 2025 forecast, mortgage rates are expected to average 6.3% for the year, possibly ending at 6.2%. This slight relief may chip away at the “lock-in” effect keeping homeowners from listing properties.

Home Prices and Inventory: A Complex Picture

The median home price slid 1.8% year-over-year, but there’s more to the story. McLaughlin notes,

"When a change in the inventory mix toward smaller homes is accounted for, the typical home listed this year has increased in asking price compared with last year."(Farberov, 2025). 

Essentially, while prices dipped, homes offered less square footage, reflecting a shift in inventory.

Inventory trends also painted a mixed picture. Active listings grew 22% year-over-year but fell dramatically from November levels. The South led the charge, with a 26.7% surge in active listings, while the West saw a 23.7% jump. Yet, housing stock in the Midwest and Northeast lagged significantly, trailing pre-pandemic levels.

Opportunities Amid the Slowdown

December’s market slowdown offered both challenges and opportunities for buyers. A smaller pool of fresh listings meant fewer options, but buyers had less competition and more time to make decisions. As Hannah Jones, Realtor.com’s senior economic research analyst, puts it:

“Winter may be a great time to buy for some buyers who are looking for more seller flexibility and can find a suitable home on the market. However, spring may be better for buyers who cannot find what they are looking for now and are willing to pay a bit more for their ‘perfect’ home” (Farberov, 2025).

Bottomline

The slowdown in December's real estate market emphasizes the need for careful planning and well-timed actions for both buyers and sellers. potential rate reductions and inventory shifts expected in 2025, staying informed and planning your next move is crucial. If you’re considering buying or selling a home, let’s connect and turn your real estate goals into reality.

 

 

Reference: Farberov, S. (2025, January 2). Deep Freeze Hit the Housing Market in December With the Strongest Seasonal Slowdown in 2 Years. Realtor.com.

RECENT BLOG POSTS

Where Millennials Are Leading the Housing Rebound in NAR’s Top 10 Markets for 2026

Top 10 U.S. housing markets are set to rebound in 2026, fueled by millennial buyers. See how affordability, inventory, and mortgage rates are creating opportunities fo… Read more

Housing Market Hits the Brakes as Listings Decline

Housing listings are declining as buyers and sellers pause. See what the slowdown means for Orange County’s real estate market in late 2025.

Why January Is the Smartest Month to Buy a Home

Why savvy buyers choose January for home purchases. Lower prices, motivated sellers, and less competition make winter the strategic time to buy.

Buyer Demand Is Rising What Sellers Need to Know Now

Mortgage rates are down and buyer demand is surging. Learn why now is the perfect time to list your home and capitalize on market momentum.

Housing Market Cooling Shows New Listing Opportunities

New home listings fell 1.7% in December 2025, creating opportunities for sellers. Discover what this cooling market means for your real estate strategy.

How to Stretch Your Options Not Your Budget When Buying

Learn strategic compromises that expand your home search without breaking the bank. Discover what matters most when buying your next home.

Home Equity Powers Your Next Real Estate Move

How your home equity can transform your next move. Learn proven strategies to leverage equity for bigger down payments, all-cash offers, and smarter investments.

Why Winter Home Sales Give Sellers a Competitive Edge

Why selling your home this winter offers less competition and more serious buyers. Get expert insights from Whitestone Real Estate on winter selling advantages.

Fed Rate Cut 2025 Impact on Mortgage Rates and Housing

The Fed cut rates for the 3rd time in 2025, but only 1 cut expected in 2026. Learn what this means for homebuyers and mortgage rates nationwide.

We are excited to assist you in finding your perfect home

Let's find a time that suits you best to chat about your goals, show you how we work, and figure out how we can help you the most