The 2025 housing market is starting to thaw

The 2025 housing market kicked off with 5,548 active listings in January, a 38% jump from last year. We haven’t seen this many active listings in January since 2014. More homes on the market is great for buyers, but will demand catch up?

The median home price was flat month-over-month at $640,000. Normally, home values bottom out in December and ramp up in the spring. We’ll see if that trend holds this year. But after a decade of big price gains, Denver home values have been stuck in neutral for the past three years—a sign that affordability is putting a ceiling on what buyers are willing to pay.

43 days on the market?!

Homes are taking longer to sell—time on market jumped to 43 days, the highest level since 2012. This number should reverse as spring brings more buyers, but with more listings hitting the market, it may not drop as much as we’ve seen in past years. And this number has been trending up ever since mortgage rates rose in 2021.

Mortgage rates…still high

No relief here—rates are hovering in the high 6s, occasionally hitting 7%. And with inflation bumping back up to ~3% at the most recent reading, experts aren’t expecting rates to come down soon. Despite the higher costs of borrowing, home prices aren’t budging. Why? Many believe the issue isn’t interest rates but a lack of housing supply overall. More homes = better affordability.

One silver lining: new listings jumped 27% year-over-year in January, bringing us back to 2019 levels—a time many consider normal. In total, we saw 3,213 new listings last month, compared to 2,457 homes going under contract. More listings than pending sales means supply is growing, which could help balance the market after years of tight inventory.

Keep an eye on months of supply 👀

A market in balance typically has 4-6 months of supply, and right now, we’re at 1.9 months—still a seller’s market, but creeping toward more equilibrium. If listings continue outpacing sales, this number will rise, giving buyers more negotiating power.

Bottom line?

Buyers: The season is just getting underway, so be patient. It’s not running away from you like it was a few years ago. Sellers may be more willing to negotiate than you think (e.g., covering closing costs or making safety and structural repairs), especially if they’ve been waiting a while to sell. Focus on a good house—not just a good deal.

Sellers: Don’t take pricing lightly. Ask your real estate agent to take you out to look at active listings around yours so you understand the competition first-hand. Price your home appropriately right out of the gate to avoid the dreaded market chase into the spring months. Remember—you get most of your attention when you first go to market!

Thanks for reading! If you want to talk about the market or your own real estate plans, just reach out! 😊