Positive forecasts for 2025: falling mortgage rates and moderately growing home prices.

Wondering where the housing market is headed in 2025? The projections are promising, especially for two key factors that directly influence your decisions: mortgage rates and home prices.

Whether you're considering buying or selling, here's a look at what the experts are saying and how these trends could affect your plans.

Mortgage Rates Are Going Down

One ​​of the biggest factors likely to influence your decisions is mortgage rates, and the forecast is encouraging. After increasing significantly in recent years, experts project a slight decline in rates throughout 2025:

While the decline will not be linear, the overall trend will be downward. There will be ups and downs depending on new economic data and inflation figures that are released. However, it is important to focus on the overall trend and not temporary fluctuations.

A reduction in rates improves affordability. As rates decline, monthly mortgage payments also decline, giving buyers more flexibility.

"A reduction in financing costs will likely increase demand by attracting buyers who had been priced out of the market by lack of affordability."

Charlie Dougherty, Director and Senior Economist at Wells Fargo

With more buyers and sellers re-entering the market, both competition and inventory will increase. The key is to stay ahead of that competition. Get prequalified today to get a head start and be ready to act.

Price projections: moderate growth

Although a slight decrease in mortgage rates is expected, home prices will continue to rise, but more moderately. According to experts, prices will grow on average 2.5% nationwide in 2025:

This growth is much more manageable compared to the double-digit increases seen in previous years.

The increase in prices is primarily due to demand. With more buyers returning to the market and more sellers listing properties, supply will also increase, helping to keep price growth in check.

However, these national trends may not exactly reflect what is happening in your local market. Some regions may experience faster growth, while others will see more modest increases. As Lance Lambert, Co-Founder of ResiClub, explains:

"Even if the average national forecast is correct, it's possible that some regional markets will see mild price declines, while others will experience elevated appreciation."

Lance Lambert

That's why it's essential to work with a local real estate expert who can give you a clear view of the market in the area where you plan to buy or sell. Contact us for personalized advice.

Conclusion

With mortgage rates expected to decline and home prices growing more moderately, 2025 is shaping up to be a promising year for both buyers and sellers.

If you have any questions about how these trends may affect your plans, explore our preconstruction options or speak to one of our expert agents.

Frequently Asked Questions

When are rates expected to drops mortgages?

Rates are projected to begin to decline gradually throughout 2025, though not evenly.

What impact will lower rates have on the housing market?

A reduction in rates will improve affordability and increase demand, bringing more buyers into the market.

Are home prices expected to continue to rise?

Yes, but more moderately, with projected growth of 2.5% nationally by 2025.

Should I wait to buy or sell?

It depends on your personal situation and the local market. Consult an expert to make the best decision.