What lies ahead for real estate in 2025? Economists, analysts, and data all point to sluggish, cautious growth—not a crash, but nowhere near the boom of recent years.
Forecasts are muted. J.P. Morgan projects housing activity will grow “at a very subdued pace” of 3% or less through the year JPMorgan Chase. Meanwhile, Moody’s chief economist Mark Zandi warns that high mortgage rates (approaching 7%) are now a clear drag on both housing and the broader economy. Prices are expected to grow by just 0.5% in 2025 and 1.2% in 2026, with some metros—like Miami, Orlando, Nashville, and Dallas—potentially seeing price declines of over 5% MarketWatch.
Yet, certain pockets may buck the trend. Business Insider observes that slowing price growth (just 2%) and increased concessions are creating buying opportunities, especially where supply is outpacing demand Business Insider.
On the affordability front, the National Association of Home Builders (NAHB) estimates that nearly 75% of U.S. households cannot afford a median-priced new home (around $460,000), assuming a 30-year mortgage at 6.5% National Association of Home Builders.
However, there’s a glimmer of relief: Ramsey Solutions reports that 15-year mortgage rates could dip to 5.5% in late 2025, which may aid affordability—though not dramatically enough to spark broad-scale demand increases Business Insider+15Ramsey Solutions+15MarketWatch+15.
Summing it up:
- Market stagnation is expected, not collapse.
- Affordability remains a bottleneck for most buyers.
- Slight interest rate easing may offer relief, but limited.
- Regional variation will define outcomes, with certain metros cooling more than others.
