Should You Buy a House in 2025?
Is it a good idea to buy a house in 2025? Learn the housing market predictions for 2025 before you make a move.
Homebuyers dealt with a tough market in 2024, and despite initial concerns about the implementation of new commission rules and regulations, the market showed resilience as home sales saw consecutive months of gains at the end of the year — the first year-over-year gain since July 2021.
According to S&P Global’s economic outlook for 2025, inflation is likely to be above the 2% target for a longer period than experts initially anticipated. If you’ve been trying to buy a home for a while now, you may be confused about the state of the market. Will it ever be a good time to buy?
According to Sebastian Frey, an experienced agent in Santa Cruz, California, the answer is “yes.”
Despite the past few years of a crazy housing market, Frey says, “People buy and sell houses regardless of where we are in any housing cycle. They buy when they have the need.”
With a stabilized market, finding a home you love at a reasonable price could be even easier. It’s always difficult — if not impossible — to time the market perfectly. Most buyers will buy based on their needs rather than market factors.
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If you have the need, here’s what you need to know about buying a house in 2025.
Is now a good time to buy a home?
Buying a home can be a great investment, but it can be nerve-wracking to deplete your savings when the economy might be in a recession or unemployment is on the rise. These market characteristics often influence the decision to buy, sell, or continue renting. Here are some of the factors that might affect your decision to buy right now:
Stabilizing home prices
It’s no secret that housing prices skyrocketed at the end of 2023, but there are signs of a stabilizing market as the median home price in the United States declined from $435,400 in the third quarter of 2023 to $420,400.
National Association of Realtors (NAR) Chief Economist Lawrence Yun says, “Even with mortgage rates modestly rising despite the Federal Reserve’s decision to cut the short-term interbank lending rate in September, continuous job additions and more housing inventory are bringing more consumers to the market.”
While you may not want to buy when mortgage rates are surging, it’s hard to predict if and when they could drop. Consistent, long-term growth in home prices in the past indicates that waiting to buy could lead you to pay even more.
