According to a recent article by Fast Co a shift is occurring in the U.S. housing market. Only three states have managed to surpass their pre-pandemic inventory levels as of January 2025: Florida, Colorado, and Texas. This development raises important questions about the current state of the housing market and how potential trade policies could affect future inventory levels.

In January 2025, just three states are above pre-pandemic levels: Colorado, Florida, and Texas. - Fast & Co.

Breaking down the numbers

The Sun Belt and Mountain West regions are leading the recovery in housing inventory, with several states showing promising movement toward pre-pandemic levels. This regional variation highlights the uneven nature of the market's recovery.

Meanwhile, some of the nation's largest housing markets continue to struggle in terms of inventory. California and New York, traditionally powerhouse real estate markets, remain significantly below their pre-pandemic inventory levels, at -31% and -46% respectively. These figures underscore the ongoing challenges in major metropolitan areas.

Colorado's market presents a particularly interesting case study. The state has seen a remarkable increase in active market inventory, jumping from 12,893 homes in January 2024 to 17,850 in January 2025. This substantial growth suggests a significant shift toward a more balanced market, potentially favoring buyers for the first time in years.

The tariff question: potential impacts on housing inventory

The possibility of new tariffs on Canadian and Mexican imports raises important considerations for the housing market's future. While current indicators suggest that a 25% tariff is unlikely in the immediate future, it's crucial to understand the potential implications of such trade policies.

Several key factors would influence the impact of any new tariffs:

The Duration: Short-term tariffs might cause temporary price spikes, while long-term policies could fundamentally reshape construction costs and practices.

The Scale: The proposed 25% rate would significantly affect building material costs, potentially leading to:

• Reduced new construction starts
• Longer construction timelines
• Higher final home prices
• Decreased overall housing inventory growth

Supply Chain Adjustments: While builders might seek alternative suppliers, the transition period could create additional market disruptions.

Navigating the market: How Shishito can help

In this evolving market landscape, buyers need to be strategic about their approach. As Colorado tips back toward a buyer's market, opportunities are emerging for savvy home seekers. Self-representation in real estate transactions has become an increasingly attractive option, offering potential savings through the strategic use of buyer's agent commissions.

For buyers considering entering the market, whether for upsizing, downsizing, or first-time purchases, the current environment presents unique opportunities. The combination of increasing inventory levels and market dynamics makes this an ideal time to consider alternative approaches to home buying.

Smart Negotiation in a Shifting Market

As the market continues to favor buyers, don't hesitate to:
- Leverage increasing inventory levels in negotiations
- Consider properties that have been on the market longer
- Request seller concessions when appropriate
- Take advantage of the growing selection of available properties

The key to success in today's market is staying informed, being prepared to act when opportunities arise, and considering all available tools and resources to optimize your home-buying experience.