The spring housing market has a vibration problem

Just as the spring homebuying season was about to kick off, the market seemingly opened its doors: Inventories were rising year over year, list prices had cooled from recent highs, and mortgage rates were at their lowest since 2024. But despite these favorable indicators, sentiment among homebuilders fell in April to the lowest level since September 2025, while Consumer confidence fell to a record low.

This discrepancy between what the figures show and what consumers feel underlies the situation the housing market is facing today: fundamentally the atmosphere is not good.

Economist and columnist Kyla Scanlon popularized the “moodframework in 2022 to describe the gap between consumer confidence and leading economic indicators. While that era was a different economic beast than today, her formulation provided a vocabulary for the hard-to-pin-down reality many consumers face.

And today, homebuyers find themselves in a similar situation. In our conversations with real estate agents, mortgage brokers and economists, one theme emerged: despite the market’s green light, both buyers and sellers are hesitant.

“Generally it’s a trust issue,” says Michael Pearsonsenior vice president of business development at A&D Mortgage LLC. “Fear and uncertainty seem to drive decision-making relative to the cost of the actual mortgage.”

The reality (and reassurance) of a resilient market

“Sentiment among consumers and builders is low for good reason,” says Jake Krimmelsenior economist at Realtor.com®.

In addition to the geopolitical tensions in the Middle East and the price volatility that follows, there is also renewed fear of job losses and broader economic uncertainty – each a good reason for sentiment to fall, let alone together.

But the question, Krimmel says, is: “How is the housing market still holding up in the spring despite that?” And the answer, he says, is that even though expectations for April were low, the market managed to beat them.

According to Realtor.com’s April Monthly Housing Report, inventory grew 4.6% year over year in April, with new listings soaring in the inventory-constrained Northeast and Midwest.

Pending sales also grew year over year for the fourth month in a row, something Krimmel says we haven’t seen since spring 2021.

“This tells us that supply and demand are picking up compared to recent years,” Krimmel explains. “While it is a low bar, it seemed unlikely that the housing market would disappear in March.”

Even mortgage rates seem to be moving in a positive direction. After rising to 6.46% in March, interest rates fell to 6.2% to 6.3% at the end of April. While this remains higher than the rates of less than 6% of 80% of current homeowners, it is significantly lower than the rates of the past two Aprils.

It is what Krimmel describes as a resilient market, one that is not necessarily friendly, but that consistently outperforms forecasts. However, he is careful to temper that optimism.

“Let’s also not forget that everything here is relative,” says Krimmel. “It doesn’t necessarily mean the housing market is good in the spring; it’s just not as bad as we thought it could be.”

So what ruins the atmosphere?

It’s that sentiment that may be the hardest sell for current home buyers and sellers.

Oliver TicknerCEO and founder of Home value lock and an insurance industry veteran, notes that the market is struggling with a “layer of uncertainty.”

“It’s not one factor; it’s the cumulative effect,” he says. “Buyers are asking a different question than they were two years ago.”

For example, instead of simply wondering if they can afford the monthly payment, Tickner finds that more and more people are wondering what happens if home prices drop shortly after purchasing.

It’s something Greg FieldA real estate agent in Phoenix describes it as a “psychological showdown” between buyers who are afraid to buy at the top of the market and sellers who don’t want to drop their price too far.

Field notes that while FOMO, the fear of missing out, was once the main driver of buyer behavior, his market is now dictated by the “fear of overpaying” – what he calls “FOOP.”

“When there is a glut of inventory and a slowdown in sales, people expect a crash,” he says. “They are afraid to take action because of a lack of clarity and direction.”

Pearson agrees, noting that consumers are bombarded with conflicting stories about where rates are going.

“It’s a lot of information to process at a time of general stress,” he adds. “Uncertainty leads some to simply not take action and err on the side of what they know versus what could be.”

This disconnect reflects the environment that inspired Scanlon’s vibes framework in 2022. She argued that because energy and food prices are the common denominator of everyday life, high costs in those areas sour the collective mood, regardless of what other economic indicators say.

Krimmel suspects that a similar pattern is playing out today, albeit through different triggers.

“While consumer confidence is likely to respond more directly to gas prices, housing demand and mortgage applications are more likely to follow changes in mortgage rates,” he says. “Both have been volatile lately, that’s for sure.”

Therefore, a dose of stability would go a long way in correcting the mood in the current market, he says.

“What would change the atmosphere the most would be a solution to the conflict in the Middle East,” says Krimmel. “Mortgage rates, gas prices and consumer confidence are all downstream of that. A lasting resolution to the conflict would bode well for financial markets and global trade and, by extension, for mortgage rates and consumer confidence at home.”

How do buyers and sellers react?

The vibration problem has shifted the market’s momentum, leading to a new era of caution.

Tickner notes that it’s not just about the numbers: “What we’re seeing is that many buyers are waiting for some form of protection or clarity, rather than a specific market trigger like a rate cut.”

Field and Pearson agree that this lack of clarity has led to a renewed pragmatism among those still active in the market.

“Buyers are no longer in a hurry and think critically before making a decision,” says Field. “When they see a house in Scottsdale sitting for two months, they don’t panic. On the contrary, they realize that a seller has to be pushed hard.”

In this sense, current conditions may actually be a sign that the market is regulating itself; a period of adjustment rather than a reflection of a real downturn, which is also visible on the quotations side.

“It is important that the price reductions for sellers are lower this year than in 2025,” says Krimmel. “These lower prices are the result of sellers entering the market with more realistic expectations about what the market will deliver.”

Krimmel says he will wait until June to reach conclusions on current economic indicators, but in the meantime the spring market can prove that while the atmosphere is low, the bottom is stable. Both sides are just waiting for the psychological fog to clear.