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US Housing Market Update: Prices Ease, Sales Stabilize in 2025
US Housing Market Update: May 2025
The US housing market continues to face challenges as we move through the second quarter of 2025. According to Zillow's latest forecast released just eight days ago, home values are projected to fall by 1.4% this year, though this is an improvement from their previous prediction of a 1.9% decrease. The downward pressure on prices is attributed to rising inventory and soft sales volume this spring.
Existing home sales are now expected to reach 4.12 million in 2025, representing a modest 1.4% increase from 2024. This figure has been revised downward from last month's forecast of 4.2 million. Despite this reduction, analysts believe that higher housing supply, decreasing policy uncertainty, and small improvements in affordability should provide some support to sales activity.
In the rental market, Zillow projects single-family rents will rise by 3.2% in 2025, while multifamily rents will see a more modest increase of 2.1%. Despite an increase in rental listings, strong demand for single-family rentals is expected to maintain relatively stable rent growth.
J.P. Morgan's analysis indicates the housing market will remain "largely frozen" throughout 2025, with price growth expected at a subdued pace of 3% or less. Housing inventory, while improving, still remains below historical averages nationally.
On the construction front, single-family home construction is expected to grow by 3% in 2025, while multifamily starts may decline by 4%. However, experts anticipate a rebound in multifamily construction by 2026, driven by an undersupply of affordable housing.
The current median existing home price stands at $403,700, with mortgage rates averaging 6.71% in April. While affordability challenges persist, conditions may improve somewhat as rates are predicted to ease while price growth moderates in the coming months.
The US housing market continues to face challenges as we move through the second quarter of 2025. According to Zillow's latest forecast released just eight days ago, home values are projected to fall by 1.4% this year, though this is an improvement from their previous prediction of a 1.9% decrease. The downward pressure on prices is attributed to rising inventory and soft sales volume this spring.
Existing home sales are now expected to reach 4.12 million in 2025, representing a modest 1.4% increase from 2024. This figure has been revised downward from last month's forecast of 4.2 million. Despite this reduction, analysts believe that higher housing supply, decreasing policy uncertainty, and small improvements in affordability should provide some support to sales activity.
In the rental market, Zillow projects single-family rents will rise by 3.2% in 2025, while multifamily rents will see a more modest increase of 2.1%. Despite an increase in rental listings, strong demand for single-family rentals is expected to maintain relatively stable rent growth.
J.P. Morgan's analysis indicates the housing market will remain "largely frozen" throughout 2025, with price growth expected at a subdued pace of 3% or less. Housing inventory, while improving, still remains below historical averages nationally.
On the construction front, single-family home construction is expected to grow by 3% in 2025, while multifamily starts may decline by 4%. However, experts anticipate a rebound in multifamily construction by 2026, driven by an undersupply of affordable housing.
The current median existing home price stands at $403,700, with mortgage rates averaging 6.71% in April. While affordability challenges persist, conditions may improve somewhat as rates are predicted to ease while price growth moderates in the coming months.
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By Quiet. PleaseUS Housing Market Update: May 2025
The US housing market continues to face challenges as we move through the second quarter of 2025. According to Zillow's latest forecast released just eight days ago, home values are projected to fall by 1.4% this year, though this is an improvement from their previous prediction of a 1.9% decrease. The downward pressure on prices is attributed to rising inventory and soft sales volume this spring.
Existing home sales are now expected to reach 4.12 million in 2025, representing a modest 1.4% increase from 2024. This figure has been revised downward from last month's forecast of 4.2 million. Despite this reduction, analysts believe that higher housing supply, decreasing policy uncertainty, and small improvements in affordability should provide some support to sales activity.
In the rental market, Zillow projects single-family rents will rise by 3.2% in 2025, while multifamily rents will see a more modest increase of 2.1%. Despite an increase in rental listings, strong demand for single-family rentals is expected to maintain relatively stable rent growth.
J.P. Morgan's analysis indicates the housing market will remain "largely frozen" throughout 2025, with price growth expected at a subdued pace of 3% or less. Housing inventory, while improving, still remains below historical averages nationally.
On the construction front, single-family home construction is expected to grow by 3% in 2025, while multifamily starts may decline by 4%. However, experts anticipate a rebound in multifamily construction by 2026, driven by an undersupply of affordable housing.
The current median existing home price stands at $403,700, with mortgage rates averaging 6.71% in April. While affordability challenges persist, conditions may improve somewhat as rates are predicted to ease while price growth moderates in the coming months.
The US housing market continues to face challenges as we move through the second quarter of 2025. According to Zillow's latest forecast released just eight days ago, home values are projected to fall by 1.4% this year, though this is an improvement from their previous prediction of a 1.9% decrease. The downward pressure on prices is attributed to rising inventory and soft sales volume this spring.
Existing home sales are now expected to reach 4.12 million in 2025, representing a modest 1.4% increase from 2024. This figure has been revised downward from last month's forecast of 4.2 million. Despite this reduction, analysts believe that higher housing supply, decreasing policy uncertainty, and small improvements in affordability should provide some support to sales activity.
In the rental market, Zillow projects single-family rents will rise by 3.2% in 2025, while multifamily rents will see a more modest increase of 2.1%. Despite an increase in rental listings, strong demand for single-family rentals is expected to maintain relatively stable rent growth.
J.P. Morgan's analysis indicates the housing market will remain "largely frozen" throughout 2025, with price growth expected at a subdued pace of 3% or less. Housing inventory, while improving, still remains below historical averages nationally.
On the construction front, single-family home construction is expected to grow by 3% in 2025, while multifamily starts may decline by 4%. However, experts anticipate a rebound in multifamily construction by 2026, driven by an undersupply of affordable housing.
The current median existing home price stands at $403,700, with mortgage rates averaging 6.71% in April. While affordability challenges persist, conditions may improve somewhat as rates are predicted to ease while price growth moderates in the coming months.