After years of high prices and bidding wars, homebuyers are finally starting to see a shift in the housing market.

In 2025, homebuyers were able to negotiate prices down more than at any other point in the past 13 years, according to new Redfin data (1). As demand cools, homes are increasingly selling below list price. In certain markets, inventory is rising. And some sellers are starting to adjust expectations after years of rapid price growth.

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That shift follows a dramatic run-up in demand during the pandemic, when remote work surged and mortgage rates fell to historic lows, fueling intense competition. By June 2022, home prices were more than 43% higher than they were in March 2020 (2).

Now, the balance of power is starting to tilt back toward buyers. In December, there were 47% more sellers than buyers nationwide, according to Redfin, giving buyers more leverage to negotiate on price, closing costs or repairs (3).

Still, this isn’t a uniform reset. Discounts vary widely depending on where you live, the type of home you’re buying and how motivated a seller is. For buyers considering a move, the shift raises an important question: Where, and for whom, do today’s discounts actually translate into real savings?

Several Sun Belt markets (particularly Florida and Texas) are seeing the highest discounts, according to Redfin. Buyers in West Palm Beach scored the biggest discount, at 10.9%, followed by Detroit, Fort Lauderdale, Pittsburgh and Miami (1).

Zillow’s data aligns with these findings. In the Sun Belt, for example, new construction has helped inventory recover, easing competition (4).

According to Zillow, the top three buyer-friendly markets for 2026 include Indianapolis, Atlanta and Charlotte, thanks to lower competition and cooling home value growth. It also notes metros in the Sun Belt and Midwest, including Jacksonville, Memphis and Detroit (4).

“Lower competition gives buyers more time to decide and wiggle room to negotiate, adding up to a less stressful shopping experience,” Orphe Divounguy, senior economist at Zillow, said in a press statement. But for sellers, “pricing strategically from the start becomes that much more important when buyers hold the power” (4).

Still, there are four metros where buyers paid more than the asking price, according to Redfin. San Francisco leads the pack at 3.8% above asking price, followed by Newark, San Jose and Oakland. The Bay Area in particular is benefitting from the booming AI sector and return-to-office mandates, so it could be harder to get a discount in those markets (1).

Type of property can also make a difference. Condo buyers who paid below list price are getting the biggest discounts, an average of 8.1%, according to Redfin. That’s a bigger discount than single-family-home buyers, at 7.9%, and townhouse buyers, at 6.5%. Among all condo buyers, that discount averaged 4.8% (1).

It could also be a good time for newly built homes. “This is one of the real oddities in today’s data. Right now, the median resale home is actually more expensive than the median newly built home,” Robert Dietz, chief economist at the National Association of Home Builders, told NAR Realtor News. Builder incentives and construction in lower-cost areas “have flipped that dynamic” (5).

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It may be a buyer’s market in many parts of the country, but it doesn’t override the basics: affordability still matters more than timing the market.

These days, many Americans are feeling the pinch, with nearly half struggling to afford groceries, utility bills, health care, housing and transportation, according to a recent Politico poll (6). And half of Americans fear that cost-of-living increases could prevent them from meeting their financial goals, according to The Harris Poll on behalf of the AICPA (7).

So potential homebuyers should consider whether this market will help them or if it just looks good on paper.

While mortgage rates are at their lowest in years, they’re still hovering above 6%, with a 30-year fixed mortgage rate averaging 6.11% as of Feb. 5, according to Freddie Mac. (8) And, while it’s possible to get deep discounts in certain markets, discounts in general still aren’t as low as they were pre-pandemic, according to Redfin’s data.

If you’re looking to buy, first determine how much you can realistically afford and if you’ve saved enough for a down payment (the bigger, the better), as well as closing costs and moving expenses.

A good rule of thumb is ensuring your monthly debt payments, including your mortgage, are less than 36% of your monthly income before taxes. Your debt-to-income (DTI) is calculated by dividing your total monthly debt payments by your gross monthly income. Then multiply that number by 100 to get a percentage.

A lower DTI means you’re more likely to get approved for a mortgage (and potentially at a better rate) since you’re considered less risky to lenders. But it’s also a good measure for determining if you’re ready to buy: If your mortgage payments are going to eat up half your monthly income, then you could struggle to get by.

So, while the market is improving for buyers, it’s not necessarily a universal “buy now” moment for everyone. Understanding your budget can help you decide if this market will help you or if walking away is still the smartest move.

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Redfin (1, 3); Federal Reserve Bank of St. Louis (2); Zillow (4); National Association of Realtors (5); Politico (6); Journal of Accountancy (7); Freddie Mac (8)

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.