2025 Real Estate Outlook: Predictions and Reflections

Happy New Year! We hope your holidays were joyful and that you’re already making strides toward your 2025 goals. Our team is excited to build on last year’s successes and help more families find their first home, next home, or investment property to grow long-term wealth.

As we start the year, here’s a look at the data and forecasts shaping the housing market—plus a review of last year’s predictions:

Home Price Forecasts

A panel of over 20 leading housing economists predicts:

• National Home Price Appreciation: Average of 2.9%, with predictions ranging from 5.5% to -2.0%.

For context, in December 2023, a similar panel predicted 1.5% appreciation for 2024, with a range from 4.1% to -1.7%. Actual appreciation outpaced expectations, with CoreLogic reporting a 3.4% increase by October 2024.

Mortgage Rate Predictions

Economists forecast mortgage rates to end 2025 at:

• Average Rate: 6.36%, with a range from 6.12% to 6.80%.

Last year’s December survey predicted 6.65% for the end of 2024, and we ended slightly higher at 6.85%.

Home Sales Activity

Economists expect:

• Total Sales: Rising 11% to 5.1 million units in 2025.

In comparison, December 2023 forecasts for 2024 ranged from 4.7 to 5.5 million units, averaging 5.1 million. Actual sales closed the year at 4.6 million, about 10% below expectations.

What Does This Mean for You?

The housing market is stabilizing, aligning with long-term historical norms that have consistently provided a reliable platform for personal and financial security. This return to modest appreciation and steady activity creates opportunities for buyers, sellers, and investors to move forward confidently.

Whether you’re exploring homeownership for the first time, upgrading, or investing, now is a great time to consider your options. Don’t let questions or concerns hold you back from achieving your goals.

Let’s Connect We’re here to provide expert advice rooted in decades of experience and market wisdom. Let’s chat about your plans—and feel free to share our contact with anyone who could benefit from informed guidance.