Homebuilder sentiment dips to a five-month low

🤗 Heyo, it's Thursday.

Today's newsletter is 630 words — a 2.5-minute read.

1. Redfin, Zillow defend rental partnership in FTC suit

Zillow and Redfin are urging a federal judge to dismiss an antitrust lawsuit targeting their $100 million rentals partnership, arguing that the government’s case is based on a flawed understanding of the digital real estate market.

In a court filing submitted last week, the companies said the lawsuit filed by the Federal Trade Commission (FTC) in September, which seeks to block their rental listings partnership, should be thrown out. They argue the agency failed to properly define the complex, two-sided market that connects renters and advertisers.

The companies also contend that the FTC overlooks the “commercial realities” of internet listing services (ILS), where increased access to listings benefits renters and creates a “feedback loop” that must be considered alongside any alleged impact on advertisers.

2. Homes.com launches AI-powered home search

On Tuesday, CoStar Group announced the launch of Homes AI, a new experience powered by OpenAI and fully integrated into Homes.com. The feature is now available to all consumers.

With Homes AI, users can engage in real-time, two-way conversations (by voice or text) to search for and explore homes and neighborhoods.

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3. Catch up quick

🌆 Austin ranked the best state capital to live in. (Realtor.com)

🎊 Texas REALTORS® announces 2025 real estate award winners. (TexasRealtors)

🏠 NAMB drafts a roadmap to restore access to affordable housing. (NMP)

📦 Most high-income earners are moving to Texas. (PFNyc)

4. Houston homes are sitting longer before selling

According to a monthly report from the Houston Association of Realtors (HAR), homes in Houston took longer to sell in January, the latest sign that the market may be shifting back toward buyers.

In January:

• Active listings rose 17% year-over-year to 34,570 single-family homes, more than triple the number on the market in January 2022.

• The average days on market increased to 66 days, up from 61 days a year ago, the longest level in nearly six years.

• Home sales remained relatively steady, totaling 4,999 across the greater Houston area, down 1.0% from January 2025. Meanwhile, pending sales rose 8.5% year-over-year.

• The median home price edged down to $322,045, its lowest level since January 2024, when it stood at $320,000.

5. Homebuilder sentiment dips to a five-month low

According to a report released Tuesday by the National Association of Home Builders (NAHB), builder confidence declined modestly in February, bogged down by persistent worries over affordability and high construction costs.

The NAHB Housing Market Index fell to 36 in February, down from 37 in January. That marks the lowest level since September, when the index hit 32. Economists had expected the index to edge up to 38.

A value below 50 means more builders see conditions as poor than good.

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