By AZ Big Media
Broader economic factors are expected to have a larger impact on the housing market than potential new federal policies in 2025, according to the Realtor.com® 2025 Housing Forecast released today. Realtor.com®‘s forecast predicts home sale prices will grow by 3.7%, mortgage rates will stay above 6% and rents will remain virtually unchanged (-0.1%). Growth in inventory with single family home starts is expected to grow 13.8% and existing for-sale home inventory is expected to grow by 11.7%, which will help bring the first balanced market in nine years.
“While President-elect Trump can work quickly with his administration to implement some regulatory changes, other policies that will affect housing, such as tax changes and broad deregulation, require the cooperation of other branches and levels of government,” said Danielle Hale, chief economist, Realtor.com®. “The size and direction of a Trump bump will depend on what campaign proposals ultimately become policy and when. For now, we expect a gradual improvement in housing market dynamics powered by broader economic factors. The new administration’s policies have the potential to enhance or hamper the housing recovery, and the details will matter.”
In 2025, Realtor.com® forecasts that buyers and sellers can expect:
- Average mortgage rates of 6.3%, with rates edging down over the year to reach 6.2% by the end of the year
- Home prices will grow by 3.7% continuing growth trends since 2012
- Rents will remain about the same with a slight 0.1% drop
- A 11.7% increase in existing home inventory continuing the trend from 2024
- Single-family new home starts will grow an impressive 13.8%, reaching 1.1 million homes, a figure not seen since 2006
- Home sales will grow 1.5% year over year to 4.07 million
- Months’ supply, a key market balance indicator, is expected to improve from a 3.7 month average in 2024 to 4.1 months in 2025. Anything under 4 is typically considered a seller’s market, while 4 to 6 months of supply is typically considered a balanced market.
