Home prices may continue to rise, while mortgage rates and tax policies are expected to shift in 2025.
The housing market has faced turbulence in recent years, marked by limited inventory, high prices, and elevated interest rates. As we look toward 2025, the political landscape is set to bring significant changes that could shake up the market. Whether you’re buying, selling, or renting, understanding these potential shifts will be crucial. Here are three key factors to remember as the presidential change looms.
1. Housing market turbulence. The market has been in a state of flux, with soaring prices and limited availability, which has made it difficult for many potential buyers and sellers. These challenges are expected to continue, as many homeowners remain reluctant to make moves.
“The political landscape is set to bring significant changes that could shake up the market. ”
2. Sub-6% mortgage lock-in effect. Homeowners who secured mortgages with interest rates below 6% are hesitant to sell. This lock-in effect is limiting the number of homes on the market, further exacerbating the inventory shortage.
3. Changes in mortgage rates and policies. Potential changes to mortgage rates, construction regulations, and tax policies could have a significant impact on housing affordability and supply. While falling home prices may benefit buyers in the near future, challenges will persist for sellers and investors as they navigate an unpredictable market.
With falling home prices expected to favor buyers, the housing market in 2025 will still present challenges. It’s important for anyone involved in buying, selling, or renting to stay informed as policies evolve and shape the market landscape.
