Want to buy a home in 2025? Here's where mortgage rates will land

Published On Dec 4, 2024, 6:00 AM

Realtor.com's 2025 housing forecast predicts that mortgage rates will slightly decline to an average of 6.3% in 2025, ending the year around 6.2%. While this modest decrease is expected to provide some relief, the ongoing affordability crisis in the housing market means it likely won't be enough to spur significant growth in home sales. Existing homeowners with lower rates are expected to remain locked in, and anything beyond the predicted decline in rates could help boost home sales. However, if rates do not decrease as expected, home sales may stagnate.

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Stock Forecasts

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Positive

The predicted slight decline in mortgage rates could ease some affordability issues for buyers, potentially leading to a moderate increase in home sales. However, the overall uncertainty surrounding economic conditions keeps the market cautious.

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Negative

If the mortgage rates do not decline as forecasted and remain high, it could further hinder the housing market growth. Existing homeowners may choose not to sell, limiting inventory. This could negatively impact construction firms.

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