One major factor in pricing

I’ve had a handful of folks ask me lately some version of the same question: “Pete, are home prices falling?” And I get why — you see a headline about cooling prices and it’s natural to wonder if that applies to your house too.

Here’s the honest answer: nationally, yes, things have cooled off a bit. But “national” is doing a lot of heavy lifting in that sentence. The real story is much more local than that, and once you understand why, it actually makes the whole thing pretty easy to follow.

I tell clients this all the time, and it’s not complicated once you break it down:

1. When there are more homes for sale, buyers have more options.
2. More options means less competition for any one house.
3. Less competition means sellers can’t push their price as high.

Flip that around, and you get the opposite. When inventory is tight, buyers are fighting over a small pool of homes, and that’s exactly what pushes prices up.

That’s playing out right now in a really visible way depending on where you look. Markets that have climbed back up to (or past) where inventory sat before the pandemic are seeing prices flatten out or dip slightly. Markets still well below those pre-pandemic numbers? Prices are still climbing there.

Lance Lambert, who runs ResiClub and tracks this stuff closely, put it about as clearly as I’ve seen it explained:

If you look at where inventory stands today compared to 2019, most of the country is still running below those levels. That’s exactly why prices are still climbing, even if only modestly, across the majority of states.

But I know the headlines are about the places where prices are softening, so let’s look at those specifically. According to Realtor.com, 15 states plus Washington, D.C. have now climbed back above their pre-pandemic inventory levels — some by a wide margin.

Now layer the latest Federal Housing Finance Agency data for home prices over the past year right on top of that. The overlap is almost a perfect match. The same states with the most rebuilt inventory are the ones where prices have softened.

That’s not a coincidence. That’s cause and effect, plain and simple.

So when you hear that national number — something like 1.7% price growth — understand that it’s really an average of two very different stories happening at the same time. A handful of markets seeing mild declines, and the much larger group still seeing prices rise.

If you're buying:

Where you’re shopping matters a lot right now. In places like Texas, Colorado, or parts of Florida, you may genuinely have some negotiating room — more homes to choose from, less competition, and sellers who are more open to working with you on price or terms. In tighter markets, especially a lot of the Northeast, you’re probably still facing real competition for good listings.

If you're selling:

Your pricing strategy is everything right now. In markets where inventory has built back up, overpricing is one of the fastest ways to sit on the market and ultimately net less than if you’d priced it right from day one. And even in tighter markets where you’re in a stronger position, getting the number right still matters if you want serious offers fast rather than a long, slow negotiation.

Either way — this is exactly the kind of thing a local agent earns their keep on. National headlines can’t tell you what’s happening on your street or in your building. I can.

Right now, where you are matters more than almost anything else when it comes to pricing. If you’re wondering what that means for your specific situation — whether you’re buying or selling on Perdido Key, Pensacola Beach, Orange Beach, Gulf Shores, or Navarre — let’s talk. I’ll give you the real picture for our market, not just the national headline.