If you've been watching the housing market wondering when things might finally change in your favor, three major developments are reshaping what buyers and sellers can expect in the months ahead.

Home prices are finally cooling in major markets. Oakland just saw a 6.8% year-over-year price drop, and Redfin reports thirteen other major metros from Austin to West Palm Beach are experiencing similar declines. Nationally, prices are up only 2% compared to last June, with Redfin economists now predicting a 1% slide by December. The typical mortgage payment has dropped to $2,671, the lowest since January, while inventory has jumped nearly 9%. For buyers, this means real negotiating power is back. You can ask for repairs, closing cost help, or seller-paid rate buydowns without getting laughed out of the room. For sellers, it's time for a reality check: those spring expectations of multiple weekend offers need to adjust to today's market where homes sit longer and pricing needs to be competitive from day one.

Meanwhile, Congress is taking unprecedented action on housing supply. The Senate Banking Committee just passed the ROAD to Housing Act with a rare 24-0 bipartisan vote, combining 27 housing bills into one massive package targeting zoning reform, city grants for new construction, and streamlined environmental reviews. If this becomes law, your neighborhood could look very different in 3-5 years, with new duplexes, accessory dwelling units, and commercial-to-residential conversions creating housing options that don't exist today. The bill also makes it easier to finance manufactured and modular homes through FHA loans, potentially opening up affordable options for first-time buyers who've been priced out of traditional housing.

But there's still a major roadblock keeping family homes off the market: capital gains taxes. Business Insider recently profiled empty-nest boomers like Joel and Kathryn Friedman who want to downsize but refuse to trigger a 20% capital gains tax on profits above $500,000. About 34% of U.S. homeowners could face this threshold today, and these boomers own twice as many 3+ bedroom homes as millennials with kids. This tax paralysis is keeping established neighborhood inventory tight and prices elevated in family-friendly areas.

If you're a buyer, this cooling market gives you opportunities you haven't had in years, but don't wait for perfect conditions that may never come. If you're a seller, price realistically and be prepared to negotiate. And if you're a boomer thinking about downsizing, get professional tax advice to understand your real options rather than letting fear keep you in a house that no longer fits your life.

These shifts won't solve the housing shortage overnight, but they represent the most significant changes in market dynamics we've seen in years. The question isn't whether the market is different now, it clearly is. The question is what you're going to do about it.

Sources: