July 2025 MBS Highway Housing Index

The MBS Highway National Housing Index fell sharply in July 2025, dropping by eight points to a level of 26. Stubbornly high rates are making affordability challenging and constraining demand, while rising inventory levels are adding to pricing pressure, especially in the South.

National Data
In July 2025, the MBS Highway National Housing Index dropped 8 points to 26. This marks the third consecutive month of sharp declines. In April 2025, the index was at 48. As a reminder, an index reading of 50 serves as the dividing line between contraction (below 50) and expansion (above 50). The overall index has not exceeded 50 since June 2024, when it last reached 53.

Both the Buyer Activity sub-index (-7 points) and the Price Direction sub-index (-10 points) saw significant decreases. The Buyer Activity sub-index is now at 27, compared to 37 at this time last year. More than half of respondents nationwide (61%) described current buyer activity as slow.

The national Price Direction sub-index now stands at 24, a massive drop from last year’s level of 50. A full 60% of respondents nationwide indicated that they were seeing price reductions in their local markets.

Regional Data
In July 2025, all seven regions saw decreases in Buyer Activity levels, with the largest declines seen in the Northeast (-23 points to 40) and the Northwest (-9 points to 36). The slowest regions for Buyer Activity were the Southeast (-7 to 15) and the Southwest (-7 to 21). Only the Mid-Atlantic (-3 to 50) managed to keep its Buyer Activity at the breakeven threshold of 50.

In a similar trend, all seven regions experienced drops in their Price Direction sub-indexes, with only the Mid-Atlantic (-5 to 51) remaining — just barely — in expansion territory. The largest drops in Price Direction were recorded in the Northeast (-18 to 47) and the Midwest (-14 to 38). The regions seeing the most pricing pressure were again the Southeast (-10 to 11) and Southwest (-5 to 17).

Question of the Month
Are ‘locked-in’ sellers getting unlocked? We’ve all heard about the millions of homeowners who would like to make a move, but feel locked-in by their low existing mortgage rates. However, with inventory levels rising across the nation, there is evidence that this lock-in effect is diminishing. When ‘life happens’ (marriage, kids, new job, etc.), eventually you’ve just got to make that move! In your local market, are you finding that the lock-in effect is:

1. About the same (still strong)
2. Somewhat diminished
3. Greatly diminished

Survey Results
Over half (53%) of respondents reported that the lock-in effect was still strong, with another 44% saying it was somewhat diminished. Only 3% of respondents considered the lock-in effect greatly diminished. This pattern was pretty consistent across the seven regions.

% of respondents saying the lock-in effect was still strong
Midwest: 63%
West: 56%
Northeast: 55%
Mid-Atlantic: 51%
Southwest: 51%
Southeast: 50%
Northwest: 41%