Is It a Good Time to Buy a House?

With inventory at its highest level in five years, buyers have a favorable window to make a deal this fall.

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Updated Sep 29, 2025 · 5 min read

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The housing market loves to keep us guessing. But when you’re ready, you’re ready — and that matters way more than waiting for a perfect moment.

Whether you’re house hunting right now or just planning ahead, here’s your game plan.

» MORE: Should I buy a house? How to tell if you're ready

How’s the housing market right now?

This month’s biggest news: Inventory remains at its highest level (4.6 months supply) since May 2020. With more houses for sale, buyers can expect more choice and less competition.

Skip ahead to read about:

Mortgage rates
Inflation and the economy
Inventory
Home prices
Home sales
Competition

» MORE: Calculator: How much house can I afford?

Weekly average mortgage rates

Mortgage rates rose slightly this week.

The interest rate on a 30-year fixed-rate mortgage averaged 6.35% annual percentage rate (APR) for the week ending Sept. 25, up six basis points from last week, according to rates provided to NerdWallet by Zillow. A basis point is one one-hundredth of 1%.

Average weekly mortgage rates

Mortgage type	APR
30-year fixed mortgage	6.35%
15-year fixed mortgage	5.78%
5-year adjustable	7.29%

Averages are for the week ending Sept. 25, 2025, according to rates provided to NerdWallet by Zillow.

🤓Nerdy Tip

Each mortgage lender sets their own rates and fees. Compare offers from at least three mortgage lenders to get the best deal. Rate shopping can save you thousands of dollars over the life of the loan.

To learn more about mortgage rates, check out these resources from NerdWallet:

📍 Right now: Mortgage rates today
📈 Looking ahead: Mortgage interest rates forecast
🤔 Shopping around: How to get the best mortgage rate

How do mortgage rates affect housing costs?

When mortgage rates are high, your home buying budget doesn’t stretch as far. Let’s say you’re prepared to make a 20% down payment on a $350,000 house. Here’s what your monthly payments would look like at different interest rates:

Interest rate	Monthly principal + interest*
5.5%	$1,590
5.75%	$1,634
6%	$1,679
6.25%	$1,724
6.5%	$1,770
6.75%	$1,816
7%	$1,863
7.25%	$1,910
7.5%	$1,958

*For a 30-year fixed-rate mortgage. Does not include homeowners insurance or property taxes.

» MORE: NerdWallet’s picks: Best mortgage lenders

Mortgage loans from our partners

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500

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on GO Mortgage

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Mortgage loans from our partners

on NBKC

NBKC

4.5

NerdWallet rating

4.5

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Min. credit score

620

Min. down payment

3%

on NBKC

on New American Funding

New American Funding

4.5

NerdWallet rating

4.5

NerdWallet rating

Min. credit score

500

Min. down payment

3.5%

on New American Funding

on GO Mortgage

GO Mortgage

4.0

NerdWallet rating

4.0

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Min. credit score

620

Min. down payment

3%

on GO Mortgage

on Rocket Mortgage

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580

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Inflation and the economy

Tariffs + recession whispers = instant overthinking. It’s normal to feel worried about making a long-term financial commitment right now. Here’s how to stay grounded:

🤔 Consider pausing: If your finances feel shaky — for example, you’re worried about job security or paying bills — it’s wise to hold off.
😌 Stay the course: If your income is steady and your budget says the numbers work, don’t let scary “what if” headlines throw you off track.

Did you know...

The Federal Reserve, the nation’s central bank, indirectly influences interest rates on all loans (including mortgages). On Sept. 17, the committee voted to lower the federal funds rate by 25 basis points, a long anticipated cut in response to a weakening job market. We’ll learn the Fed’s next move at its upcoming meeting, Oct. 28-29.

» MORE: The Fed cut rates. Will it help the housing market?

Is it a buyer’s or seller’s market?

Right now, it's a moderate sellers market. In a seller's market, sellers have the upper hand. In a buyer's market, buyers have the upper hand.

Right now: Seller’s market (moderate)

After years of sellers having a strong upper hand, the vibe is finally shifting to give buyers more leverage. Here are the signs of a more balanced market:

✅ More houses to choose from.
✅ Less competition.
✅ Wiggle room on price (including sellers accepting offers below asking).
✅ Willingness to negotiate on contract terms.

» MORE: How to win a bidding war on a house

What’s the difference between a buyer’s market and a seller’s market?

Whether we’re in a buyer’s or seller’s market comes down to supply and demand. Available inventory affects who has the upper hand in negotiations.

📈 Buyer’s market = high inventory. Buyers have lots of choices and can take their time. Price cuts are common. Buyers might ask sellers to cover some costs or fees.
📉 Seller’s market = low inventory: Buyers have fewer choices. Prices and competition heat up. Expect multiple offers above asking price.
⚖️ Balanced market = enough homes to go around: Supply and demand are roughly even. This generally happens when the real estate market has about six months’ worth of available inventory.

Did you know...

When a house is listed for sale, it becomes “inventory.” Inventory is measured as a number of months’ supply at the current sales pace. A six-month supply means it would take six months to sell all listed homes, if no new ones came on the market.

Let’s dig into the details using August 2025 data from the National Association of Realtors (NAR).

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Inventory: Highest in five years

Good news: Inventory is up nearly 12% compared to a year ago, reports the NAR.

Currently, inventory sits at a 4.6-month supply of homes for sale, the same as last month and up from 4.2 months in August 2024.

"Home sales have been sluggish over the past few years due to elevated mortgage rates and limited inventory," NAR chief economist Lawrence Yun said in a news release. "However, mortgage rates are declining and more inventory is coming to the market, which should boost sales in the coming months."

Home prices: High and still (slowly) climbing

Meanwhile, home prices continue their upward trend — although not as rapidly as in previous months. Nationally, year-over-year home prices have risen every month for more than two years.

The national median price for existing homes sold in August was $422,600, up 2% from August 2024, according to the NAR.

Across the four U.S. regions — Northeast, South, West and Midwest — year-over-year prices also grew, but at different rates.

"The Midwest was the best-performing region last month, primarily due to relatively affordable market conditions,” Yun said. “The median home price in the Midwest is 22 percent below the national median price."

Here’s a breakdown of median housing prices by region:

Midwest: $330,500 up 4.5%
Northeast: $534,200, up 6.2%
South: $364,100, up 0.4%
West: $624,300, up 0.6%

🤓Nerdy Tip

Buying a house is expensive up front, but it can help you build long-term wealth. Try our rent vs. buy calculator to compare costs over time and see your break-even point.

» MORE: How much does it cost to buy a house?

Home sales: Fairly steady

Sales of existing homes dropped a mere 0.2% from July to August, signaling pent-up demand in the market as buyers wait for lower mortgage rates and more inventory.

Competition: Easing up

The August 2025 Realtors Confidence Index, a survey of the NAR’s members, highlights recent trends real estate agents are seeing in their local markets that are easing the competition among buyers. Some shifts to note:

Bidding wars aren’t the norm. A home listed for sale received an average 2.5 offers in August, up slightly from 2.1 last month and 2.4 last year. For context: In the era of hot bidding wars in 2021 and 2022, the average was around five offers per home.
Fewer homes are selling above list price. In August, 20% of homes sold above listing price, nearly the same as last month’s 21% and no change from the previous year.
Homes are staying on the market longer than last year. Houses stayed on the market for a median 31 days in August, up from 28 days last month and 26 days last year.

Overall, though, demand still outpaces supply. This is hardly a mellow market: Good homes sell quickly, and buyers should still expect competition out there.

» MORE: How to buy a house, step by step

Should I buy a house now or wait?

Ultimately, whether it’s a good time to buy comes down to your personal financial readiness. If your credit score needs work or you’re in major debt, consider tackling those goals first. You also need to be emotionally ready for the commitment of owning a house.

Here are some green flags that it’s a good time to buy.

✅ Stability: You have steady income and employment, and you’re ready to stay in one place for several years.
✅ Lifestyle fit: For first-time buyers, you’re up for the responsibility of paying for maintenance and repairs. For repeat buyers, your current home no longer meets your needs: You’re ready for more space, a new neighborhood or to downsize.
✅ Savings: You'll need money for a down payment and closing costs, as well as for moving costs and other expenses.
✅ Low debt: Your debt-to-income ratio (DTI) shows how much of your monthly income goes toward paying debt (like student loans, car payments or credit cards). The lower your DTI, the better your mortgage rates and terms. A DTI of 36% or below is most attractive to lenders.
✅ Good credit score: Borrowers with credit scores of 740 and above get the best mortgage rates and terms. It’s possible to qualify with a score in the 600s, but your options are limited.

Did you know...

According to mortgage data provider ICE Mortgage Technology, the average FICO credit score for purchase mortgages in the last 30 days was 735. The average DTI was 40%.

» MORE: Home loans for bad credit

The takeaway: If you’re ready to buy, jump in now

Don’t try to time the market perfectly. National trends can be unpredictable, but if you’re in a good spot, that’s what matters most. Do you have a stable income, solid savings and a desire to settle down? You can find a way to make it work.

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