The number of homes for sale topped 1 million for the first time since winter 2019 and exceeded 2020 levels for the second month in a row, according to Realtor.com’s May 2025 housing report. Although this is a key pandemic recovery benchmark, inventory remains about 14% below pre-pandemic levels, the report said.
Inventory of for-sale homes grew 31.5% year over year in May, marking 19 consecutive months of year-over-year inventory growth. New listings increased in every major region across the country, Realtor.com said.
However, homes are taking almost a week longer to sell than a year ago, and in some metros, median time on market exceeds pre-pandemic levels, particularly in the West. Prices were stable, but the report notes an increasing share of sellers reduced their asking prices as affordability challenges persist. Mortgage rates increased starting in mid-May and are again nearing 7%, said the report.
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Listings under contract fell 2.5% year over year, similar to April’s 2.6% drop in pending home sales, said the report.
New listings, which typically ramp up in May to kick off the Spring homebuying season, declined by 1.4% month over month. Realtor.com said this may hint that this Spring may experience a slower start to the season. Year over year, newly listed homes climbed 7.2% in May, which was a modest decline from April’s 9.2% increase.
Housing inventory is growing fastest in the West, where listings were up nearly 41% in May. Inventory was up nearly 33% in the South, 23% in the Midwest and 19% in the Northeast. The report said inventory compared with pre-pandemic norms has recovered the most in the West and the South but lags significantly in the Midwest and Northeast. These patterns echo regional construction trends, with the South leading the nation in new housing starts last year.
At the metro level, the strongest year-over-year inventory growth was in Washington, D.C., up 76%, followed by Las Vegas, up 67% and San Diego, up 66%. More than half of large metros remain below pre-pandemic inventory levels, said the report. Of the 22 metros whose inventory now exceeds their pre-pandemic norms, all are located in the South or West. The markets with greatest inventory relative to their pre-pandemic levels are Denver (+100%), Austin (+69%) and Seattle (+60.9%). The three metros that have recovered least are Hartford (-77.7%), Chicago (-59.3%) and Virginia Beach (-56.7%).
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Kristen Smithberg
Kristen Smithberg is a Colorado-based freelance writer who covers commercial real estate, insurance, benefits and retirement topics for BenefitsPRO and other industry publications.
