What Do Experts Forecast for the 2025 Housing Market?

By Travis Bard

We have a simple goal - impact the lives of our clients and change the lives of our agent partners. The PLACE.com business platform allows us to do both and we could not be more excited about the future.

Is 2025 a better year to buy or sell a home? We just wrapped up our 2025 goal-setting and planning retreat, and we’re excited about what’s ahead. We’ve been getting a lot of questions about what to expect in the market, so I’d like to share some insights on what we’re seeing and what we anticipate.

1. Mortgage rates will decrease. We expect a slight drop in interest rates over the next few months. We’re not anticipating a big drop, but rates could go down by about half a point to three-quarters of a point. Anything more than that would be surprising. This decrease in interest rates will help buyers step into the market. In fact, in the past week or two, we’ve noticed a small uptick in buyer demand and activity, and we expect that trend to continue.

2. More inventory. Right now, we’re at the highest inventory levels we’ve seen in several years. Buyers have plenty of options to choose from, but they can be quite picky about their selections. We expect this to continue for a while.

3. Home prices will increase. I believe the market will strengthen a bit. We’re likely to see a slight appreciation in home prices, likely a couple of percentage points or even up to 5%. This is reasonable, given the current market conditions.

4. Increase in Home sales. In 2024, we had just under 4 million home sales for resales, not counting new homes. We’re projected to finish around 3.9 million, marking the lowest number of home sales since 1995. This points to pent-up demand, and we expect many who have been waiting will finally enter the market this year.

Overall, we’re looking at a healthy market. While we don’t expect to return to the 6 million homes sold in a year like what we saw three years ago, there’s going to be an improvement in this year’s housing market.

If you have any questions about selling or buying a home, we’re here to help. We can connect you with a great lender if you need one. Don’t hesitate to reach out at (928) 710-7007 or travis@legacyren.com and let us know how we can assist you.