Is 2025 a good time to buy a house? See what factors affect the housing market in 2025 and what that means for buyers and sellers alike.
No matter how much experience you have in real estate, buying or selling a house is a decision that takes some forethought. If it’s something you’re considering, the experts at Barker Realty recommend this first step: take a look at the current housing market and determine whether now is a good time to buy or sell.
In a recent article, Business Insider said that some of the biggest forces currently influencing the housing market include mortgage rates, low housing supply, and home prices. How will these factors change in 2025? Read these housing market trends to help you make the best decision.
In February 2025, the average mortgage rate was 6.51%, stated Business Insider. There is hope that mortgage rates will ease up as price growth stabilizes this year, but it may not be as drastic a change as buyers would like. Their prediction is that mortgage rates may end up in the low-to-mid 6% range by the end of 2025.
High mortgage rates impact both potential buyers and sellers, discouraging both groups. However, they can sometimes keep housing prices from rising as quickly. But because of the low housing inventory trends, home prices in the U.S. have continued to increase over the past few years.
In June 2024, Zillow reported that the U.S. is 4.5 million homes short of a healthy housing supply. A low housing supply tends to increase homes and rent costs.
“For housing market conditions to improve, housing supply needs to increase,” reported Business Insider. “As mortgage rates decrease, more sellers should come onto the market and list their homes, increasing the number of for-sale homes available.”
The article also stated that Fannie Mae expects the new construction housing numbers to drop in 2025 and improve in 2026, but the Mortgage Banker Association (MBA) said the numbers will start to rise this year and continue into next.
Currently, the average home value is just over $357,000, according to Zillow, which is 2.6% higher than last year. Home prices are expected to rise 3.5% year over year in 2025 but slow down to 1.7% in 2026, according to Fannie Mae. The MBA sees this year’s rate slowing to 1.3% and remaining there in 2026.
Right now is not a particularly easy time for buying or selling a house. But that doesn’t mean you can’t accomplish your goals. Barker Realty can help you navigate housing market rates, timing, and any other areas where you have questions. Contact our team today to get started and make the most of your real estate investments.
"Let each of you look not only to his own interests,
but also to the interests of others..."
Phil. 2:4
