TX Home Buyer Year End Update – 2025
December 21, 2025
Have home prices reached their lowest point at the end of the 2025? Maybe.
Most buyers these days are asking themselves: “If I buy now, am I going to overpay?”
We looked at real sales prices in Dallas–Fort Worth area (Collin, Dallas, Denton, Tarrant counties) over the last three years, including:
- The 2022 peak, the slowdown in 2023, and the softening in 2024 and 2025
We also looked at what happened after interest rates were cut in late 2025.
What we found
Here’s what the numbers show:
- Prices peaked in 2022, came down in 2023, stayed soft in 2024
- Prices in 2025 did not jump back up even after three rate cuts, instead, prices stayed flat or drifted lower
There were no big price spikes in the last three years. Each year seasonal patters looked similar, with slow movement, not sharp swings. It appears that whatever economic conditions that lead to a price bubble deflation have persisted, but the home market usual price inertia is able to withstand those economic changes over prolonged periods of time.
What this really means for buyers
Most of the big price jumps already happened years ago. Since then, prices have been working their way down, slowly, and the downward movement in 2025 was very slow compared to other years.
That means:
- Buyers today are not chasing a rapidly cooling market
- Instead, buyers are negotiating in a market that already cooled
- The risk of “overpaying” is much lower than it was in 2022
Simple takeaway on overpaying for homes in 2025
For the past 3 years, the prices inched lower slowly, not sharply. Buying now does not mean overpaying the way buyers did back during the COVID days.
Effect of interest rate changes on prices and affordability
Most buyers these days are asking themselves: “Should I wait for interest rates to drop before buying?”
We looked at:
- Interest rate changes in 2025
- Monthly home prices before and after those changes
- Real mortgage payments at different rates on a typical home
In 2025, interest rates were cut three times: September, October, and December.
After three rate cuts, home prices did not jump. Prices stayed flat or drifted down.
In terms of mortgage affordability, on a real $350,000 loan:
- A drop from 5.9% to 5.8% lowered the payment by about $22 per month
- Every 0.01% drop in interest rates saved about $2 per month
What this really means for buyers
To save real money each month, rates would need to drop A LOT, not a little, like they have been doing for the entire 2025. But those big drops are:
- Hard to predict & very rare to happen (the last really big interest rate cut was during COVID)
- Not something buyers can control
Meanwhile, buyers today can often:
- Ask for a lower price (and probably get it)
- Ask for closing cost help (and potentially get it) to minimize their initial expenses
- Reduce how much cash they bring to the table
Those things save more money right here and now, and in larger “jumps” than waiting on drastic behaviors from banks / the Fed. Focusing only on rates causes buyers to miss where the real savings are.
Potential benefits are especially strong for current renters, as paying monthly rent is similar to having a loan with 100% annual interest rate with no returns on any investments. In the current real estate environment, whatever potential savings that could come from future interest rates are offset by compounding costs of rental payments every month.
Simple takeaway
Small rate cuts barely move the payment by hundreds of dollars. Lower prices and seller cashbacks could save buyers more money than waiting for rates to drop.
Final verdict for home buyers in 2025
Most buyers these days are asking themselves: “Should I keep waiting, or should I buy now”
What we examined
We looked at:
- What happened to prices for buyers who waited in 2023, waited in 2024, and waited in 2025
- What happened to the average buyer’s monthly payment on a $350,000 house with
- What does it mean for home buyers trying to understand their best move
What we found
Buyers who waited for the past 3 years:
- Did not get huge price discounts but increased their negotiating power on seller cash-back and
- Did benefit slightly from modest and gradual price decline
- Received very limited mortgage reduction despite 3 mortgage rate cuts in 2025
- In case of renters, most likely spent more on rent in 2025 than the price cuts AND mortgage payment reductions
What this really means for buyers
Plain English:
Waiting longer has not unlocked big savings.
Waiting can make sense if:
- You are fixing credit
- You are saving for a down payment
- You are not ready to commit
Waiting does not help if:
- You are hoping for a big price drop
- You are waiting for tiny rate cuts
- You are paying rent while you wait
In those cases, waiting mostly means paying more rent and gaining nothing in return.
Pros and cons of waiting (very simple)
Pros of waiting
- More time to prepare
- More time to save
- More time to shop
Cons of waiting
- Rent keeps leaving your pocket
- Prices may not drop much more
- Good homes may get more competition
What buyers should NOT be doing
Based on the last three years, most DFW buyers should not:
- Wait only because they feel hopeful for more price cuts for additional interest rate cuts
- Wait for a sudden market crash (the last 3 years show significant post-COVID market stability)
- Ignore the certain and accumulating cost of paying rent while waiting for uncertain and small savings in the monthly savings coming from cuts to interest rates or slow home price reductions.
Fear-based waiting has been an expensive process for many buyers.
