What to Expect From the 2025 Housing Market

In recent months, there’s been plenty of conversation — and mixed information — about what will happen with home prices this year. Here’s what the data says.  

Last year, the supply of homes for sale grew because homes stayed on the market longer. And as Mike Simonsen, Founder of Altos Research, says, inventory levels will continue to increase throughout 2025:  

“2025 is poised to continue the trend of rising inventory across the country. We’ll probably finish 2025 with 15% more homes available than we have now.” 

If you’re worried that’ll make prices crash, don’t be. Nationally, inventory is still far below demand, which means you shouldn’t expect home prices to fall.  

As you can see from the above graph, the latest projections point to continuing home price appreciation. The good news is, we won’t see prices skyrocket like they did in years past. Instead, they’ll climb at a slower, more sustainable pace that’s typical of a more normal market. 

The reason? It all comes down to the number of homes for sale and how many buyers are out there. David Childers, President of Keeping Current Matters, sums it up best: 

“The main driving force on pricing is the limited amount of inventory in most markets across the country. That issue is not going to be solved overnight or in the next twelve months.” 

Of course, it’s important to keep in mind that the housing market is hyper-local, so what prices look like in your area may vary from what’s happening nationally.  

For a deeper dive into home price forecasts and how to explain these insights to your clients, download our 2025 Market Forecast eGuide.  

With rates sitting at their highest levels in over six months, this is probably the top question everyone has right now. Here’s how to address it the next time someone says they’re going to wait for rates to come down.  

The truth is, rates aren’t going back to the 3-4% we saw a few years ago. The upside? Experts project mortgage rates should ease a bit over the course of the year.  

As you can see from the chart, rates are forecast to settle in the mid-to-low 6% by the end of 2025. 

Though, keep in mind, forecasts are based on what experts know right now. And since everything from inflation to employment to general market uncertainty have an impact on where rates go from here, some ups and downs along the way are still very likely. 

Want a more in-depth analysis of this year’s mortgage rate forecasts and how to talk to your clients about them? Download our 2025 Housing Market Forecast eGuide. 

There’s no doubt that affordability challenges and the number of people with historically low mortgage rates caused many consumers to pause their buying or selling plans over the last year. 

But thanks to a combination of inventory growth in 2024 and more rate-locked buyers coming back into the market, experts estimate, based on data, an uptick in homes sales this year. (See graph below) 

Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), agrees: 

“Home sales momentum is building. More buyers have entered the market as the economy continues to add jobs, housing inventory grows compared to a year ago, and consumers get used to a new normal of mortgage rates between 6% and 7%.” 

While we won’t see a massive jump, this does point to signs that the market is strengthening.  

Download our 2025 Market Forecast eGuide to learn more about how to use data and visuals to help you close more deals this year.  

Last year’s housing market had its share of challenges, but 2025 offers a new crack at driving your business if you’re willing to put in the work. With more transactions potentially on the horizon and clients with changing needs, how you approach your action plan right now will determine your success. 

You have a choice. You can let market uncertainty dampen your motivation, or you can take charge, position yourself as a trusted advisor for your clients, and, ultimately, sell more homes this year. 

By building a reputation as a go-to problem solver and the local authority on the housing market, you’ll strengthen relationships, develop trust, and convert leads into loyal clients who turn to you time and time again. 

Here’s how to do exactly that.  

• Be able to answer your clients’ top questions with data and visuals to back up your expert opinion.

• Listen to what your prospects are saying so you can provide them with the most helpful information based on their unique needs and situation.

• Go all-in on video. Answer commonly asked questions with a quick video that relies on trustworthy data to uplevel your expertise. RealTalk by KCM™, the first all-in-one video creator for agents makes this super easy.

• Leverage social media to keep your sphere in the loop on the latest updates and market trends. And be sure to balance your posts between housing market insights and your personal brand. 

• Create an email marketing framework to stay in touch with your clients, and make it look sharp using KCM’s customizable Email Builder. 

Get proven strategies to amplify your business, grow your client base, and craft a game plan for winning by downloading our 2025 Market Forecast eGuide.  

No one can predict the future, but with the right data and world-class visuals, you can develop a relevant market opinion based upon facts. And right now, experts are forecasting mortgage rates will settle down a bit this year alongside a moderate, more normal climb in home prices and sales.