Experts Predict Home Values to Increase 1.5% to 3.6% in 2025.

Top Housing Experts Predict 2025 Market Trends

Key Insights:

Mortgage Rates: Expected to stay high but there are strategies to lower them.

Home Values: Predicted to rise incrementally across the country, with projects that can further boost value.

Market Dynamics: Slightly favoring sellers but heavily influenced by local conditions.

Mortgage Rate Forecast for 2025

In 2023, the average 30-year mortgage hit a peak of 7.79%. While the Federal Reserve is expected to lower the federal funds rate multiple times in 2025, mortgage rates might not fall drastically. Both Fannie Mae and the Mortgage Bankers Association predict an average rate of 6.4%.

Historical Context: Mortgage rates have rarely been as low as during the pandemic. Historically, 30-year rates have hovered between 4% and 6%, making a return to 3% highly improbable.

Pro Tip: Improve your credit score to get a better mortgage rate. Early consultation with a mortgage professional can provide a roadmap to achieving this.

Home Value Projections

Since 2020, home prices have surged by 29.7%. For 2025, Fannie Mae anticipates a 3.6% increase in home values, while MBA forecasts a 1.5% rise. Local market dynamics will play a crucial role in determining actual values.

Consider Home Improvement Projects: Certain upgrades can yield a high return on investment and further increase your home’s value.

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Buyer's vs. Seller's Market in 2025

The 2025 housing market will lean slightly towards sellers, with a national Months Supply of around 4 months. Inventory is rising, which might shift the balance towards buyers over the year. Real estate remains local; thus, conditions will vary by region.

Pro Insight: Consult a real estate professional to understand whether your local market favors buyers or sellers.

Advice for Homeowners and Buyers

Homeowners: Expect modest value increases. Consider home improvements for better returns.

Buyers: Start planning early. Understand your price range, improve your credit, and prepare for a down payment.

Sellers: Prioritize your objectives—whether it’s getting top dollar or moving within a specific timeframe—and work with a professional to develop an effective

strategy.

These predictions provide a snapshot of what to expect in 2025. As the year progresses, stay informed and consult with professionals to navigate the dynamic real estate market.