August 2025 U.S. Housing Market Update: Prices, Inventory Surge, Mortgage Rates, and Hard Money Financing Strategies

Introduction

The U.S. housing market in August 2025 is delivering a mixed signal to buyers and investors. Inventory is rising sharply in many states, yet home prices remain resilient and in many markets are hitting new records. Mortgage rates are still elevated, and the Federal Reserve’s next decision could shift market momentum.

For real estate investors, the combination of more available properties and steady pricing creates an important window to act. This month’s report examines current housing market data, mortgage rate forecasts, and how 1st Private Capital hard money lending solutions can help you move quickly while opportunities last.

Inventory is Increasing Across the U.S.

Housing supply is expanding nationwide, and properties are spending more time on the market. This creates more negotiation leverage for buyers and investors who are ready to close quickly.

National Trends (Year-over-Year):

• Active listings: over 2 million homes (up from 1.87 million last year)

• Inventory growth: up 8 percent

• Median days on market: 43 days (up from 35 days)

States with the Largest Year-over-Year Inventory Growth:

1. Nevada: +53%

2. Maryland: +48%

3. North Carolina: +41%

4. California: +37%

5. Arizona: +36%

6. Colorado: +36%

7. South Dakota: +36%

8. Virginia: +34%

9. Washington: +32%

10. New Mexico: +31%

Investor Takeaway from 1st Private Capital:
More inventory means more opportunities, especially in competitive states like California, Arizona, and Colorado. With our hard money loans, you can make strong, non-contingent offers and close in days rather than weeks, giving you a significant advantage in securing the best properties.

Prices Remain Surprisingly Resilient

Despite higher inventory levels and mortgage rates, national home prices are up 1.4 percent compared to August 2024.

Markets with Price Declines (Year-over-Year):

• Austin, TX: -4.9%

• Miami, FL: -4.7%

• Chicago, IL: -4.4%

• Los Angeles, CA: modest decline

• Denver, CO: modest decline

Approximately 35 percent of markets are seeing price declines, while 65 percent are stable or rising. The ongoing shortage of affordable homes continues to support prices.

1st Private Capital Perspective:
Stable prices mean competition will remain strong for desirable properties. Using our fix-and-rent or mid-construction hard money loan programs allows you to act quickly, even in markets where conventional financing is slow to approve.

2025 and 2026 Price Forecasts

2025 Predictions:

• Fannie Mae: +4.1%

• Mortgage Bankers Association: +1.3%

• National Association of Realtors: +3%

2026 Predictions:

• Fannie Mae: +2%

• Mortgage Bankers Association: +0.3% (flat)

• National Association of Realtors: +4%

Analysts expect moderate price growth to continue rather than a sharp decline.

Action Plan from 1st Private Capital:
If you wait for a price drop that may never come, you could miss your buying window. Our hard money loans help you secure the property now and refinance later if rates improve.

Mortgage Rates and Federal Reserve Outlook

Current Average 30-Year Fixed Rate: approximately 6.6 percent

The Federal Reserve meets on September 17, 2025. Current expectations are:

• 92.5 percent chance of a 0.25 percent rate cut

• 7.5 percent chance of no change

• 0 percent chance of a 0.5 percent cut

Mortgage rates move closely with the 10-year Treasury yield. A rate cut could provide some relief, but it may also spark more buyer demand, pushing prices higher.

Why This Matters for Hard Money Borrowers:
Traditional bank loans can take 30 to 60 days to close, which means you could lose the deal while waiting for approval. With 1st Private Capital, hard money funding can close in as little as 5 to 7 days, allowing you to lock in your investment before the market shifts.

Potential Market Shift: Fannie Mae and Freddie Mac IPO

The U.S. government is exploring plans to release Fannie Mae and Freddie Mac from federal control through an IPO.

Possible Impact:

• Loss of government backing could push mortgage rates higher by about 1 percent

• A hybrid approach is being considered to limit the effect on rates

1st Private Capital Insight:
If rates rise due to these changes, hard money lending will become even more valuable for investors seeking quick, flexible financing without the red tape of conventional lending.

Key Takeaways for Buyers and Investors

• No national housing crash has occurred; most markets remain stable or rising

• Affordability challenges persist due to high prices and mortgage rates

• Federal Reserve decisions in late 2025 could influence buyer demand and price trends

• Hard money loans from 1st Private Capital allow you to act fast and secure deals ahead of slower-financing competitors