If you’ve been keeping an eye on the housing market this year, you’ve probably noticed some shifts already. But what can we expect as 2025 continues? Let’s break down the latest expert forecasts on home prices, mortgage rates, and what it all means for buyers and sellers right now.
Are Home Prices Going to Fall?
Many potential buyers are holding out hope for a significant drop in home prices—but that’s not what experts are predicting. While some markets have experienced slight declines, the overall trend doesn’t point to a major downturn. In fact, according to an average of eight top industry forecasts, home prices are still expected to rise by around 1.5% to 2% in 2025.
The National Association of Home Builders (NAHB) notes that price growth is slowing, thanks to higher mortgage rates and a growing number of homes on the market. These factors are taking some pressure off price increases, but they aren’t signaling a crash. Yes, a few areas are seeing minor price drops—averaging around -3.5%—but that’s a far cry from the dramatic 20%+ decline we saw during the 2008 housing crisis.
And when you zoom out, the bigger picture is clear: according to the Federal Housing Finance Agency, home values are still up 55% nationally over the past five years. So even if prices cool slightly, most homeowners are sitting on solid equity.
What’s Next for Mortgage Rates?
Mortgage rates continue to be a hot topic—and a reason some buyers are choosing to wait. But that strategy may not pay off. Recent updates from Yahoo Finance and the Federal Reserve suggest that mortgage rates will likely stay in the 6% range through the end of 2025. Rather than trying to time the market perfectly, experts recommend making housing decisions based on your personal financial goals and lifestyle needs. A small shift in rates likely won’t make or break affordability—and waiting too long could mean missing out on a great home that suits you today.
The Bottom Line
The 2025 housing market isn’t in freefall—it’s finding balance. Price growth is cooling, mortgage rates are holding steady, and inventory is improving. If you’re thinking about buying or selling, now’s a good time to focus on your personal situation, not just the headlines. Partner with a trusted real estate professional, like me, who understands your local market and can help you navigate this evolving landscape with confidence.
