2025 Housing Market Forecast Predicts Modest Growth in Prices and Inventory

Realtor.com anticipates a more balanced market with increased home supply, steady rent levels, and slightly lower mortgage rates.

Realtor.com projects a 3.7% rise in home prices and a 1.5% increase in home sales for 2025, continuing over a decade of price growth.
Mortgage rates are expected to decline slightly but remain above 6%, with rates forecasted to average 6.3% over the year.
Housing inventory is set to grow significantly, with existing home listings up 11.7% and single-family home starts increasing by 13.8%, improving market balance.
Rental prices are predicted to remain flat, supported by a surge in apartment construction reaching a five-decade high in 2024.
Economic factors, including potential Federal Reserve rate cuts and President-elect Donald Trump's proposed housing policies, could influence affordability and construction costs.