The U.S. housing market is showing surprising resilience as home prices continued to rise in July despite a growing supply of homes for sale, giving buyers more choices without triggering the broad price declines some analysts had expected.

According to new Homes.com data, the national median home-sale price reached $400,000 in July, up 2.6% from a year earlier. At the same time, the number of homes for sale increased 4.4% year over year, while home sales rose 2.9%. The combination suggests that the market is becoming more balanced without experiencing a major correction in prices.

The continued price growth is notable because mortgage rates have remained elevated and buyer demand has been uneven across the country. More inventory would normally put greater pressure on sellers to reduce prices, but demand in many markets has remained strong enough to prevent a nationwide decline.

The regional differences are particularly striking. Chicago recorded the strongest price growth among major markets, with home prices rising 6.5% from a year earlier. Other markets, however, are experiencing much slower appreciation or weaker conditions as buyers respond to affordability pressures and higher borrowing costs.

The market is also behaving differently depending on the type of property being sold. Single-family home prices increased 2.5% year over year, while condominium prices rose 2.3% and townhome prices increased just 0.8%. That suggests demand remains strongest for traditional single-family housing, even as buyers become more selective about what they can afford.

For buyers, the increase in inventory is still an important development. More listings mean households have greater opportunities to compare homes, negotiate with sellers and avoid the intense bidding competition that characterized the pandemic housing boom. Realtor.com data also shows that 20% of listings received a price cut in July, while the national median list price declined 2.4% from a year earlier.

But improved negotiating power does not necessarily mean housing has become affordable.

Mortgage rates remain well above the levels many homeowners enjoyed several years ago, and today's home prices still require substantial monthly payments. As a result, some buyers are choosing to wait, while others are looking in less expensive markets or negotiating for seller concessions and mortgage-rate buydowns.

The latest data also shows why the national housing market has become increasingly difficult to describe with a single trend. Some cities are seeing strong price appreciation and relatively healthy sales, while others are experiencing growing inventory, longer selling times and more aggressive price reductions.

That regional divide is likely to become even more important during the remainder of 2026. Markets with strong employment, limited housing supply and relatively high demand may continue seeing prices rise, while areas with more abundant inventory could provide buyers with substantially greater negotiating power.

For now, however, the national market is showing more resilience than many expected. Prices are still rising, sales are higher than a year ago, and inventory is expanding at the same time. That combination suggests the housing market is moving toward a more balanced environment rather than heading into a broad nationwide correction.

The bigger question is whether that balance can hold if mortgage rates remain elevated. If borrowing costs eventually decline, today's expanding inventory could give buyers more opportunities without causing major price declines. If rates remain high, however, affordability could continue limiting demand and eventually put greater pressure on sellers.

For now, the housing market is sending a mixed but important message: buyers are gaining more choices, but sellers are still holding onto much of their pricing power.