Realtor.com® 2025 Housing Forecast: Will There be a "Trump Bump" in Housing Next Year?
Rhea-AI Summary
Realtor.com's 2025 Housing Forecast predicts a more balanced market with home prices growing by 3.7% and mortgage rates staying above 6%. Key projections include:
- Average mortgage rates of 6.3%, declining to 6.2% by year-end
- 11.7% increase in existing home inventory
- 13.8% growth in single-family new home starts, reaching 1.1 million homes
- 1.5% year-over-year growth in home sales to 4.07 million
- Virtually unchanged rents (-0.1%)
The forecast suggests broader economic factors will have a larger impact on housing than potential new federal policies. The market is expected to see its first balanced conditions in nine years, with months' supply improving from 3.7 to 4.1 months in 2025.
Positive
- 13.8% growth in single-family new home starts, reaching highest level since 2006
- 11.7% increase in existing home inventory
- 1.5% growth in home sales to 4.07 million
- 3.7% projected home price growth
- Market moving toward balanced conditions with 4.1 months' supply
Negative
- Mortgage rates to remain elevated above 6% throughout 2025
- Rent prices expected to remain stagnant (-0.1%)
Insights
The 2025 housing forecast signals a significant market rebalancing with several key developments. The projected 3.7% price growth alongside
The shift from a 3.7-month to 4.1-month supply indicates the first balanced market in nine years. This transition, combined with 11.7% inventory growth and nearly
The forecast acknowledges potential policy impacts while emphasizing broader economic factors as primary market drivers. The anticipated regulatory changes under the Trump administration, particularly regarding federal land availability and construction regulation reduction (currently adding
Regional variations are notable, with the South leading rental stock growth at
Inventory gains bring first "balanced" market in nine years, as the Trump administration takes office
"While President-elect Trump can work quickly with his administration to implement some regulatory changes, other policies that will affect housing, such as tax changes and broad deregulation, require the cooperation of other branches and levels of government," said Danielle Hale, chief economist, Realtor.com®. "The size and direction of a Trump bump will depend on what campaign proposals ultimately become policy and when. For now, we expect a gradual improvement in housing market dynamics powered by broader economic factors. The new administration's policies have the potential to enhance or hamper the housing recovery, and the details will matter."
In 2025, Realtor.com® forecasts that buyers and sellers can expect:
- Average mortgage rates of
6.3% , with rates edging down over the year to reach6.2% by the end of the year - Home prices will grow by
3.7% continuing growth trends since 2012 - Rents will remain about the same with a slight
0.1% drop - A
11.7% increase in existing home inventory continuing the trend from 2024 - Single-family new home starts will grow an impressive
13.8% , reaching 1.1 million homes, a figure not seen since 2006 - Home sales will grow
1.5% year over year to 4.07 million - Months' supply, a key market balance indicator, is expected to improve from a 3.7 month average in 2024 to 4.1 months in 2025. Anything under 4 is typically considered a seller's market, while 4 to 6 months of supply is typically considered a balanced market.
How could President-elect Trump policies impact the housing forecast in 2025?
A Republican sweep of the presidency and both houses of Congress will likely result in pros and cons for the housing market. Among President Trump's proposals to address the housing shortage is making more federal land available for homebuilding and addressing regulation, which estimates suggest contributes to more than
What should buyers and sellers expect in 2025?
Overall buyers and sellers should expect to see a more balanced market in 2025, which will require some give and take on both sides. Homebuyers frustrated by higher interest rates will have some buyer-friendly conditions in 2025, such as the highest for-sale inventory since December 2019 and nearly
Limited inventory and strong demand in many areas could mean that sellers still have the upper hand in terms of negotiating prices, especially in desirable locations. However, higher interest rates or slower than expected income growth could lead to fewer buyers being able to afford homes, which might result in longer selling times or price reductions in some markets.
Key Trends and Wildcards to Watch in 2025:
Slight rebound in overall home sales – The 2025 forecast has home sales slightly increasing, with an expected annual count of sales to be
Mortgage rates – While markets are factoring in expectations of a higher-rate environment than previously thought, there is uncertainty around which policies will take priority and whether the specifics match or merely rhyme with campaign promises. These details will matter for the outlook and for mortgage rates.
Rent prices will largely remain the same, more rental supply growth in the South – While the surge in new multifamily supply offers renters more options, the large renter population will dampen any significant impact on rental prices. The median asking rent in 2025 is expected to be only slightly lower than in 2024 (-
Big increases in both new home sales and new home starts – While existing home sales are expected to remain largely unchanged for the year in 2025, new home sales and single-family housing starts are expected to outperform. With a substantial construction deficit over the last decade, builders have room to run and may get an additional boost from a builder-friendly administration that understands the need for more construction. Single-family starts are expected to total 1.1 million in 2025, an impressive
"While more inventory means buyers will likely have more time to make purchase decisions in 2025, in any market, a fast-acting buyer will have a higher likelihood of making the winning offer," said Hale. "For this reason, it's wise to get prepared financially and for the home search overall. Thankfully for homebuyers there are more tools, like Realtor.com®'s dynamic map layer, to help home buyers and sellers get ready."
When faced with an overwhelming amount of market information, Realtor.com®'s dynamic map layers can help consumers make better sense of it. These new map-based search features allow buyers and sellers to explore a wide range of neighborhood and home details with just a quick glance, such as home estimates, lot size, year built, sold price, sold price per sq ft, market hotness, climate factors and more.
For more information about the Realtor.com® 2025 housing forecast, visit: https://www.realtor.com/research/2025-national-housing-forecast/
Local Market Predictions – 100 Largest
Metro | 2025 | 2025 Price |
15.0 % | 4.2 % | |
10.3 % | 6.6 % | |
-4.1 % | -4.2 % | |
12.3 % | 8.0 % | |
15.1 % | 10.2 % | |
14.2 % | 5.8 % | |
14.5 % | 10.2 % | |
9.9 % | 6.0 % | |
16.2 % | 2.7 % | |
5.5 % | 2.7 % | |
-8.3 % | 2.3 % | |
2.0 % | 12.3 % | |
-1.8 % | 5.6 % | |
-5.4 % | 4.9 % | |
9.7 % | 8.5 % | |
13.2 % | 9.6 % | |
5.8 % | 7.0 % | |
15.7 % | 8.4 % | |
2.2 % | 6.3 % | |
12.4 % | 4.5 % | |
8.2 % | 7.3 % | |
9.4 % | 5.0 % | |
27.1 % | 12.7 % | |
12.1 % | 8.2 % | |
3.4 % | 5.7 % | |
7.6 % | 9.2 % | |
2.3 % | 4.3 % | |
7.2 % | 11.5 % | |
13.6 % | 8.0 % | |
2.7 % | 4.9 % | |
2.4 % | 6.2 % | |
14.1 % | 10.1 % | |
19.3 % | 8.4 % | |
8.1 % | 5.1 % | |
3.9 % | 7.7 % | |
17.3 % | 7.7 % | |
5.1 % | 8.9 % | |
16.8 % | 5.1 % | |
3.8 % | 5.6 % | |
7.2 % | 7.3 % | |
7.7 % | 8.2 % | |
13.5 % | 9.8 % | |
6.7 % | 6.9 % | |
3.7 % | 8.3 % | |
10.6 % | 10.3 % | |
10.3 % | 4.9 % | |
5.5 % | 12.3 % | |
18.6 % | 4.8 % | |
4.2 % | 5.5 % | |
4.6 % | 6.1 % | |
-8.4 % | 5.5 % | |
19.8 % | 7.0 % | |
8.3 % | 10.5 % | |
24.0 % | 9.0 % | |
8.6 % | 5.7 % | |
6.3 % | 6.2 % | |
4.5 % | 8.3 % | |
-8.4 % | 9.7 % | |
1.7 % | 5.9 % | |
11.0 % | 5.9 % | |
3.2 % | 10.4 % | |
2.2 % | 11.8 % | |
8.4 % | 6.6 % | |
2.5 % | 5.8 % | |
15.2 % | 12.1 % | |
8.2 % | 8.0 % | |
0.8 % | 9.6 % | |
12.3 % | 6.1 % | |
12.2 % | 13.2 % | |
1.9 % | 4.7 % | |
-1.5 % | 6.1 % | |
11.1 % | 6.7 % | |
-14.7 % | 7.2 % | |
2.2 % | 9.0 % | |
21.6 % | 6.1 % | |
11.4 % | 8.8 % | |
8.7 % | 6.8 % | |
5.2 % | 8.9 % | |
9.7 % | 7.1 % | |
6.7 % | 10.0 % | |
10.9 % | 9.1 % | |
3.4 % | 7.3 % | |
4.6 % | 7.5 % | |
-10.3 % | 4.0 % | |
11.6 % | 5.7 % | |
Spokane-Spokane | 12.2 % | 6.9 % |
-0.4 % | 8.7 % | |
11.0 % | 6.8 % | |
6.2 % | 9.8 % | |
1.7 % | 6.7 % | |
9.1 % | 11.8 % | |
10.8 % | 6.7 % | |
12.5 % | 12.4 % | |
2.5 % | 6.5 % | |
Urban | 13.4 % | 6.7 % |
23.4 % | 6.6 % | |
17.0 % | 5.0 % | |
3.0 % | 6.2 % | |
7.7 % | 9.2 % | |
1.2 % | 8.0 % |
Methodology
Realtor.com®'s model-based forecast uses data on the housing market and overall economy to estimate values for these variables for the year ahead. The forecast result is a projection for annual total home sales increase (total 2025 existing-home sales vs. 2024) and annual median home sales price increase (2025 median existing-home sales price vs. 2024).
About Realtor.com®
Realtor.com® is an open real estate marketplace built for everyone. Realtor.com® pioneered the world of digital real estate more than 25 years ago. Today, through its website and mobile apps, Realtor.com® is a trusted guide for consumers, empowering more people to find their way home by breaking down barriers, helping them make the right connections, and creating confidence through expert insights and guidance. For professionals, Realtor.com® is a trusted partner for business growth, offering consumer connections and branding solutions that help them succeed in today's on-demand world. Realtor.com® is operated by News Corp [Nasdaq: NWS, NWSA] [ASX: NWS, NWSLV] subsidiary Move, Inc. For more information, visit Realtor.com®.
Media Contact
Mallory Micetich, press@realtor.com
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SOURCE Realtor.com
FAQ
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