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Home Prices Cool, Buyers Get Picky, and Housing Plays Worth a Second Helping

House prices are barely budging, mortgage rates are still heavy, and buyers are slow-walking decisions into year-end

Author

Noah Zelvis
November 30, 2025

Thanksgiving week is usually about stuffing, not statistics, but the housing data just served up a pretty clear plate: prices are cooling, buyers are picky, and even small rate dips are enough to pull people off the sidelines.

This isn’t a 2021-style frenzy; it’s a cautious, negotiated market where patience pays.

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The big picture here is that home prices are still rising, but just barely. Nationally, they were up a little over 1% over the past year, which is the weakest pace since the early days of the Fed’s rate-hike spree. Inflation is actually running hotter than house prices now, which means real home values are effectively getting deflated over time.

Under the hood, almost all of the major metro areas saw monthly price slippage before seasonal adjustment. Places that boomed the hardest during the pandemic, think parts of the South and West, are now seeing some of the sharpest givebacks as higher mortgage payments collide with stretched budgets. The message is affordability walls are real, and even solid demand can’t ignore math.

And yet, the market isn’t dead. Existing-home sales in October climbed for a second straight month to their highest level since February, helped by a small drop in mortgage rates earlier in the fall. 

That tiny bit of relief was enough to coax some buyers back in. Inventory is still below pre-Covid levels but up from last year, and there are now more sellers than buyers by a wide margin. Deals are getting renegotiated, more contracts are being canceled, and buyers are demanding concessions instead of waiving everything just to win.

Call it the great housing truce. Sellers have to be realistic, buyers can finally breathe, and the market is settling into a slower, more balanced rhythm instead of a bidding-war circus.

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Actionable Stuff

  • Think balance, not boom. This isn’t a rocket-ship housing cycle; it’s a grind. Focus on businesses that can make money in a steady, not-spectacular transaction environment.

  • Favor solid plays. Platforms, landlords, and materials names that touch many transactions may be safer than pure upside bets on soaring prices.

  • Follow affordability. Builders and landlords aimed at entry-level or good-enough homes stand to benefit as buyers trade down or stay renters longer.

  • Expect more negotiation. A world with more price cuts, concessions, and canceled contracts actually helps platforms and services that make matching and re-matching easier.

  • Keep dry powder. Short-term cash vehicles (T-bills, HYSAs) give you room to add on dips if the next data batch or Fed comment spooks the market.

Poll: How do you decide if a big purchase is “worth it”?

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Top Picks

Zillow Group (NASDAQ: Z)

When the housing market slows down, people don’t stop browsing, they just click more and move slower.

Zillow sits right at that behavior shift. Even if buyers are taking longer to commit, they’re still scrolling listings, comparing prices, and getting prequalified. Every one of those steps runs through Zillow’s ecosystem in some form.

This more browsing, slower buying setup can actually support engagement. If you’re refreshing apps and tracking price cuts while deciding whether to move next spring, Zillow is winning your screen time.

More inventory, more sellers testing the waters, and more negotiations all mean more eyeballs and leads flowing across the platform.

Zillow doesn’t need a massive price boom to work; it needs activity. A cautious, balanced market with more back-and-forth and a lot of shopping fits that bill.

As the data point to a slow grind, not a collapse, Zillow may be one of the cleaner ways to ride a reshuffling market instead of betting on any one region.

Invitation Homes (NYSE: INVH)

When buying feels expensive and uncertain, renting the house you wish you could afford becomes Plan B.

Invitation Homes owns and manages single-family rentals across the U.S., giving families a backyard and driveway without the 30-year mortgage commitment. In a world where affordability is stretched, that pitch is very compelling.

Slower price growth and sticky mortgage rates mean more households may stay renters longer, especially those who are tired of losing bidding wars or nervous about job security.

That supports occupancy and gives Invitation Homes decent pricing power without needing the kind of wild appreciation we saw during the pandemic.

You’re basically tapping into the “I still want a house, just not this rate” crowd. While the ownership side of the market wrestles with higher monthly payments and cautious buyers, single-family rentals can keep collecting steady checks and gradually push rents higher in line with wages and demand.

Meritage Homes (NYSE: MTH)

If there’s one builder lane that still makes sense in this environment, it’s the attainable, practical segment.

Meritage Homes leans hard into that, with a focus on energy-efficient, move-in-ready homes aimed at first-time and first-move-up buyers. That’s exactly where the pent-up demand lives when affordability is tight.

Even with prices cooling, the country still doesn’t have enough entry-level housing stock. When mortgage rates ease even a little, those buyers are the ones who rush back first.

October’s bump in existing-home sales shows how sensitive that demand is to small rate moves.

A builder focused on functional floor plans, predictable costs, and reasonable monthly payments can capture that wave.

Meritage doesn’t need a speculative boom or luxury bidding wars. It needs a steady stream of households finally able to make the leap from renting to owning, especially in markets where prices are flattening or gently correcting.

That slow thaw environment is tailor-made for this kind of builder.

Floor & Decor (NYSE: FND)

Even if people aren’t trading houses, they’re still making the one they have look less like a 2020 project and more like a 2025 home.

Floor & Decor thrives on that refresh, not relocate behavior that tends to show up when moving is expensive but staying put feels stale.

The company’s big-box warehouses, deep inventory, and everyday pricing appeal to both pros and ambitious DIYers.

When buyers are picking apart listings and negotiating harder, sellers are more likely to redo some flooring, update a bathroom, or spruce up an entryway to stand out. That flows straight into Floor & Decor’s aisles.

Heading into the holidays, there’s also a practical angle: nobody wants guests walking on cracked tile or worn carpet.

Whether it’s pre-listing upgrades or fix this before the family arrives, FND benefits from small, targeted projects that make a visible difference without a whole-home remodel.

It’s an easy way to participate in housing activity without relying on home prices themselves to rip higher.

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Bottom Line

This housing market isn’t a feast or a famine, it’s more like a Thanksgiving leftovers situation. There’s enough on the table to work with, but you have to be selective and patient. Prices are cooling, buyers are cautious, and small rate moves are nudging activity rather than igniting a frenzy.

You can use that to your advantage. Focus on names that get paid when people browse, negotiate, rent longer, or update what they already own. Start with modest positions, add on pullbacks, and let a slow normalization in housing do the work for you while you enjoy the actual turkey.

That’s it for today’s edition—thanks for reading! Reply to this email with any feedback or let me know which macro trends or markets you’d like me to cover next.

Best Regards,
—Noah Zelvis
Macro Notes