New Credit Score Rules, Powell Resignation Rumors & Rising Inventory |July ‘25 Housing Market Update

It was July 2025, and everybody was talking about inventory exploding, a possible change at the Federal Reserve, and rates that economists thought could reach the low sixes to high fives by the end of the year. Here is what I covered.

The biggest news in a decade of mortgage lending, in my opinion, was Vantage Score 4.0. Most of you know your FICO score, that three-digit number that matters a lot. On July 8, 2025, the FHFA announced that lenders could use Vantage Score 4.0, a different credit scoring model, on loans sold to Fannie Mae and Freddie Mac. What I like about it is that it can take in things like rental history, when that history is reported to the credit bureaus, and a 24-month payment history, and it leaves out medical collections. VantageScore estimated that about 5 million more people could get a mortgage credit score under the new model. So if you are thinking about buying a house over the next year, ask about it, because it could help you qualify if the lender you speak with offers it.

There was also a rumor that Fed chair Jerome Powell might resign because of political pressure. I did not get into the details, and he had not resigned when I recorded. The point for homeowners and buyers is that a change at the Fed could shake things up. If you bought over the last couple years at a higher rate and want it to come down, or you are waiting to buy, pay attention to that.

Some headlines were calling it a buyer's market. I do not think it is one yet. Inventory levels were spiking, but this time of year, July and August, we usually see the highest inventory. Add tariffs and high interest rates and people are putting homes on the market at a higher pace than last summer. Calling it a crash would not be accurate. A crash is when prices fall 20% or more. If this continued for another six months, though, we would see many markets where values dipped in 2025 for the first time in years. That could be a good opportunity for buyers, especially if rates came down.

Where we were, the market was still frozen. A lot of sellers think it is 2021, and their homes are sitting. The homes that were selling were priced well and did not need much work. If your home is not updated, focus on price.

For buyers who think 2009 is coming and want to wait, that is a big risk. If you are ready to buy, you have a pre-approval, and you can afford a house at your price point, I think you should do it. Timing the market is impossible. If rates come down with the pressure on the Fed and inflation finally easing, the market could heat back up, and even if prices fall 1% or 2% this year, we could erase that in 2026.

If you are moving to another area, I also work with good real estate agents in other places, and I would be glad to connect you rather than have you find one at random. To talk about pre-approval and credit options, start with first-time buyer options or get your rate. MortgageOne is now licensed in 49 states.