Navigating the 2025 Housing Market: Experts Answer Your Burning Questions
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The 2025 housing market is well underway and full of uncertainty in the latter half of the year. Buyers and sellers have burning questions only the best real estate agents are qualified to answer. Here are their predictions for what’s to come.
Housing Market Predictions for 2025
The 2025 housing market is gradually balancing out, moving away from the previous seller-dominated market. However, buyers still face high interest rates, low inventory and regional variations.
Mortgage Rates
Currently, 30-year fixed mortgage rates will likely fluctuate between 6% and 7% until 2027, but this rate could change depending on investors. Despite this outlook, Burgh2Bay founder and real estate investor Dan Fabrizi says, “I have a feeling interest rates will fall before the end of the year, which helps on your monthly payment.”
However, agent Jake Kennedy from Tennessee-based firm Compass Ardmore offers sage first-time home buyer advice, saying, “When interest rates do finally go down, it’s not like the list price of your starter home or your dream home are going to drop, too.” He suggests jumping in rather than sit on the sidelines waiting for the perfect deal.
Inventory
The housing market has been stagnant due to inventory. “I think between now and the next five months is the low point of activity,” says Jeff Lichtenstein, CEO and broker at Echo Line Properties, who places blame on increasing prices. “Part of the low activity was also because the baseline of inventory in May of 2022 was at a historic low and being short 4 million homes in the United States.”
Studies show an upward tick, though. Realtor.com’s April 2025 Housing Market Trends report says housing inventory for sale increased by 30.6% year over year, making it the 18th consecutive month of growth. Newly listed homes were also up by 9.2% from April 2024.
Regional Differences
Regional differences are more apparent across urban areas in the U.S. and Canada. While major cities remain popular, many are too expensive to buy homes. The suburbs offer buyer and renter-friendly conditions. In fact, according to one report, 203 U.S. suburbs have more renters than homeowners across 20 of the largest metropolitan areas.
If you want to purchase a home, experts recommend making an offer, even if it’s below the asking price. “Do not pass on homes because the price is more than you want to pay. Do not be afraid to make an offer that is considerably less than asking. They might be reluctant to lower the price of the listing, but sellers are negotiating more and accepting lower offers,” says real estate professional Danny Johnson of Danny Buys Houses.
Lifestyle Shifts
Despite companies calling workers back to the office, several people still work from home. Nearly 65% of employees feel more productive with a remote work lifestyle, which helps them create a better work-life balance. Naturally, many look for a designated home office space when searching for a house.
Andrew Fortune of Great Colorado Homes says, “Stick to your list of must-haves, and if you cannot find everything, buy the place that matches your needs, not just your dreams.”
Top Expert Answer to Your Burning Housing Market Questions
Whether you’re buying or selling a house, you likely have several questions about the 2025 housing market. Renovated asked some of the most qualified real estate experts for their take on the current trends.
1. Will Home Prices Rise or Fall in 2025?
The real estate market forecast for 2025 is difficult to predict. REI Hub CEO Adam Hamilton says, “Luckily, there are certain areas where prices are declining a little bit, largely due to the decrease in home sales so far in 2025. Other than that, it’s hard to tell people with any certainty when things are going to get better.” He encourages buyers not to get discouraged and to continue looking for opportunities.
Doug Van Soest of SoCal Home Buyers says to focus on your financial preparedness and long-term plans instead. “The market is dynamic and might go up and down, but what will always triumph is the smart decisions that are made using reality as a benchmark.”
2. Is it a Good Time to Buy a House?
Karen Watts, founder and CEO of DomiSource, says she can understand why people ask this question, especially amid high interest rates and media outlets warning of a failing housing market. However, based on her experience of moving 22 times, she says, “There is never a perfect time to buy a home. It doesn’t matter if interest rates are 3% or 7%. You can always find a good reason to wait for better conditions.”
Erin Hybart of Erin Hybart Real Estate says, “Buyers want to time the market perfectly, but it’s more about your personal timing than the market’s. It is about balancing what you can get with what you can afford.”
3. Is it a Good Time to Sell a House?
Colorado-based Coldwell Banker Realty agent Jim Merrion says, “Once the full tariff effects are known and providing greater corporate certainty, coupled with the likely beginning of mortgage rate cuts starting in the Fall, the 2026 Spring Market will likely see many regions of the country begin shifting back to empowering sellers and reducing buyer leverage.”
Ryan David, owner of We Buy Houses in Pennsylvania, delivers an essential lesson for sellers: Be cautious when accepting an offer contingent on the buyer selling their home. From his standpoint, “It’s very difficult having a conversation and trying to help someone in such a unique situation simply because those situations sometimes do not pan out. You end up having a ton of time invested into the project, leaving both the seller and you no better off than they were beforehand.”
Sellers should prioritize buyers who have secured financing and bring fewer contingencies. This will ensure a smoother sales process.
4. How Competitive Is the Current Market?
Current housing market trends continuously change, so competitiveness varies from place to place. “Right now, in the suburbs on the Main Line — outside of Philadelphia — purchasing a home remains highly competitive,” says Compass Ardmore real estate agent Lauren Lipowicz.
Interestingly, the luxury real estate market shows greater competition as older generations cash in on their assets. Many buyers are targeting homes over $1 million in coastal Florida and Texas, the latter of which has some of the lowest taxes in the nation.
5. When Will Mortgage Rates Drop?
All signs point to a slow trickle in decreasing mortgage rates, with shifts between 6% and 7% in the coming years. However, some experts suggest not letting current rates stop you from purchasing a home now.
“Rates might not go back to where they were, but if the house fits your needs and the payment works for you, that’s a win. And if rates drop later, refinancing is always an option,” says Brett Johnson of New Era Home Buyers.
6. How Can Homeowners Maximize Value Before Selling?
Real estate agents offer expert advice to sellers looking to maximize their home’s value before selling. Decluttering your home is vital for potential buyers to visualize themselves in the space. Painting your kitchen cabinets, bathrooms, walls, and front door can also increase your home value by $6,000, as long as it’s the right color.
You don’t necessarily need to undergo massive upgrades for huge returns. In fact, you may not get what you hoped for anyway. “The biggest turn-off is undertaking a huge renovation without direction and adequate funds,” says Sonya Coke and Aiesha Mannle, real estate agents with Los Angeles-based luxury brokerage Nourmand & Associates.
Don’t forget the less glamorous upgrades, though. “Buyers catch on when they see a fresh kitchen but find a 20-year-old AC unit or roof. They are spending upward of $600,000 in some parts of Florida. At that price, they expect substance, not just shine,” says Mark Sanchez of Gator Rated.
Mark Van Steyn of EasySell Cash Homebuyers also says, “Smell is the silent deal killer. Nothing stops a showing faster than offensive odors. Pet smells, cooking odors or even strong air fresheners can turn a maybe into a no before we even get past the foyer.” Your best bet is to ventilate your home and light a candle that smells like delicious vanilla cookies.
7. What Should First-Time Buyers Know?
Robert Levi Thompson, a real estate agent and growth coach at Legacy Group International, has some excellent homebuying tips for 2025 first-time buyers hoping for all the bells and whistles. “I think first-time home buyers don’t understand that they may have to purchase an older home that is dated. They don’t realize that a little flooring and paint can really improve the home.”
Realtor Fiona Dogan from Rye, New York, also tells first-time buyers to prepare to fight for the right price. “Buyers are turned off by the thought of having to fight for a house, potentially overpaying if they win, and constant exhaustion and disappointment if they lose. Some buyers walk away in this market and continue to rent.”
Preparing for Success in 2025 and Beyond
The 2025 housing market might be volatile, but you shouldn’t let it stop you from buying or selling your home. These experts seem hopeful about market trends, and so should you.
Frequently Asked Questions
What Regions Are Experiencing the Most Inventory Growth?
Latest inventory reports show that the housing market jumped across every U.S. region in June 2025. The West’s inventory is up by 38%, while the South’s is up by 30%. Las Vegas, Nevada, is the leading U.S. metropolitan area, with a 77.6% inventory growth.
What Financing Options and Assistance Programs Are Available for First-Time Buyers in 2025?
Homebuyers can pursue conventional loans and government-backed alternatives — such as FHA, VA and USDA — to help purchase a home in 2025. Down payment assistance programs like grants, forgivable loans and second mortgages are other options.
What Sustainability and Smart Home Features Impact Home Values?
Sustainability and smart home features can significantly increase your property value by attracting eco-friendly buyers and those looking for long-term savings. Consider upgrading to energy-efficient windows and smart thermostats, installing solar panels and landscaping with native plants.
About The Author
Rose is the managing editor of Renovated and a dedicated freelance writer with over six years of experience in the home and garden industry. Her passion for landscaping and sustainable practices is deeply rooted in her upbringing — growing up in a family of contractors, she was exposed to the world of construction and design from a young age. This hands-on experience fostered her love for nature and gardening, giving her a green thumb and a keen eye for creating beautiful outdoor spaces.
Throughout her career, Rose has honed her expertise in researching and writing about sustainable construction practices, focusing on innovative technologies that enhance the built environment while minimizing environmental impact. She is particularly interested in green roofing, water-efficient landscaping, and integrating native plants in design, all reflecting her commitment to sustainability. Rose's work has appeared in various publications, where she shares valuable insights and practical tips for seasoned professionals and novice DIY-ers.
In addition to her writing, Rose enjoys collaborating with landscape architects and contractors on projects that emphasize eco-friendly design and sustainable materials. She believes that every garden has the potential to be a vibrant ecosystem and works to inspire others to create spaces that are not only beautiful but also environmentally responsible.
