Sign up to save your podcasts
Or
Share US Housing Market Outlook for 2025: Navigating Shifting Trends and Affordability Challenges
Share to email
Share to Facebook
Share to X
Share to email
Share to Facebook
Share to X
Or
US Housing Market Outlook for 2025: Navigating Shifting Trends and Affordability Challenges
US HOUSING MARKET UPDATE: MAY 2025
The US housing market continues to face headwinds as we approach mid-2025, with recent data showing mixed signals for both buyers and sellers.
According to Zillow's forecast released just yesterday, home values are projected to fall by 1.4% in 2025, an improvement from their previous prediction of a 1.9% decrease. This decline comes as rising inventory puts downward pressure on home values across the country.
Existing home sales are now expected to reach 4.12 million in 2025, representing a modest 1.4% increase from 2024, though this projection has been revised downward from last month's forecast of 4.2 million.
The rental market shows diverging trends, with single-family rents projected to rise by 3.2% while multifamily rents will see a smaller increase of 2.1%.
J.P. Morgan's analysis indicates the housing market will remain "largely frozen" throughout 2025, with growth expected at a subdued pace of 3% or less. Supply conditions are shifting, with Michael Rehaut, head of U.S. Homebuilding Research at J.P. Morgan, noting that "new homes for sale are at 481K, the highest level since 2007."
For consumers, affordability remains challenging. The median existing home price stands at $403,700, up 2.7% year over year. April's mortgage rates averaged 6.71%, continuing to pressure potential buyers.
Construction trends show single-family home building expected to grow by 3% this year, while multifamily starts may decline by 4%.
Looking ahead, Fannie Mae predicts home prices will rise 4.1% year over year in 2025 before slowing to 2% in 2026, suggesting longer-term stabilization.
The combination of higher housing supply, moderating policy uncertainty, and small improvements in affordability should provide some relief to homebuyers in the coming months, though economic uncertainty continues to make the market's trajectory difficult to predict.
The US housing market continues to face headwinds as we approach mid-2025, with recent data showing mixed signals for both buyers and sellers.
According to Zillow's forecast released just yesterday, home values are projected to fall by 1.4% in 2025, an improvement from their previous prediction of a 1.9% decrease. This decline comes as rising inventory puts downward pressure on home values across the country.
Existing home sales are now expected to reach 4.12 million in 2025, representing a modest 1.4% increase from 2024, though this projection has been revised downward from last month's forecast of 4.2 million.
The rental market shows diverging trends, with single-family rents projected to rise by 3.2% while multifamily rents will see a smaller increase of 2.1%.
J.P. Morgan's analysis indicates the housing market will remain "largely frozen" throughout 2025, with growth expected at a subdued pace of 3% or less. Supply conditions are shifting, with Michael Rehaut, head of U.S. Homebuilding Research at J.P. Morgan, noting that "new homes for sale are at 481K, the highest level since 2007."
For consumers, affordability remains challenging. The median existing home price stands at $403,700, up 2.7% year over year. April's mortgage rates averaged 6.71%, continuing to pressure potential buyers.
Construction trends show single-family home building expected to grow by 3% this year, while multifamily starts may decline by 4%.
Looking ahead, Fannie Mae predicts home prices will rise 4.1% year over year in 2025 before slowing to 2% in 2026, suggesting longer-term stabilization.
The combination of higher housing supply, moderating policy uncertainty, and small improvements in affordability should provide some relief to homebuyers in the coming months, though economic uncertainty continues to make the market's trajectory difficult to predict.
View all episodes
By Quiet. PleaseUS HOUSING MARKET UPDATE: MAY 2025
The US housing market continues to face headwinds as we approach mid-2025, with recent data showing mixed signals for both buyers and sellers.
According to Zillow's forecast released just yesterday, home values are projected to fall by 1.4% in 2025, an improvement from their previous prediction of a 1.9% decrease. This decline comes as rising inventory puts downward pressure on home values across the country.
Existing home sales are now expected to reach 4.12 million in 2025, representing a modest 1.4% increase from 2024, though this projection has been revised downward from last month's forecast of 4.2 million.
The rental market shows diverging trends, with single-family rents projected to rise by 3.2% while multifamily rents will see a smaller increase of 2.1%.
J.P. Morgan's analysis indicates the housing market will remain "largely frozen" throughout 2025, with growth expected at a subdued pace of 3% or less. Supply conditions are shifting, with Michael Rehaut, head of U.S. Homebuilding Research at J.P. Morgan, noting that "new homes for sale are at 481K, the highest level since 2007."
For consumers, affordability remains challenging. The median existing home price stands at $403,700, up 2.7% year over year. April's mortgage rates averaged 6.71%, continuing to pressure potential buyers.
Construction trends show single-family home building expected to grow by 3% this year, while multifamily starts may decline by 4%.
Looking ahead, Fannie Mae predicts home prices will rise 4.1% year over year in 2025 before slowing to 2% in 2026, suggesting longer-term stabilization.
The combination of higher housing supply, moderating policy uncertainty, and small improvements in affordability should provide some relief to homebuyers in the coming months, though economic uncertainty continues to make the market's trajectory difficult to predict.
The US housing market continues to face headwinds as we approach mid-2025, with recent data showing mixed signals for both buyers and sellers.
According to Zillow's forecast released just yesterday, home values are projected to fall by 1.4% in 2025, an improvement from their previous prediction of a 1.9% decrease. This decline comes as rising inventory puts downward pressure on home values across the country.
Existing home sales are now expected to reach 4.12 million in 2025, representing a modest 1.4% increase from 2024, though this projection has been revised downward from last month's forecast of 4.2 million.
The rental market shows diverging trends, with single-family rents projected to rise by 3.2% while multifamily rents will see a smaller increase of 2.1%.
J.P. Morgan's analysis indicates the housing market will remain "largely frozen" throughout 2025, with growth expected at a subdued pace of 3% or less. Supply conditions are shifting, with Michael Rehaut, head of U.S. Homebuilding Research at J.P. Morgan, noting that "new homes for sale are at 481K, the highest level since 2007."
For consumers, affordability remains challenging. The median existing home price stands at $403,700, up 2.7% year over year. April's mortgage rates averaged 6.71%, continuing to pressure potential buyers.
Construction trends show single-family home building expected to grow by 3% this year, while multifamily starts may decline by 4%.
Looking ahead, Fannie Mae predicts home prices will rise 4.1% year over year in 2025 before slowing to 2% in 2026, suggesting longer-term stabilization.
The combination of higher housing supply, moderating policy uncertainty, and small improvements in affordability should provide some relief to homebuyers in the coming months, though economic uncertainty continues to make the market's trajectory difficult to predict.