Forecasting the Housing Market Through Year-End

If you’ve been keeping an eye on the housing market, you’ve probably noticed some changes unfolding already in 2025. But what’s coming next? From home prices to mortgage rates, here’s what top industry experts are predicting for the remainder of the year—and what it could mean for your next move.

Are Home Prices Set to Drop?

Many buyers are holding out hope for lower prices. And with headlines pointing to minor dips in certain areas, it’s easy to think a bigger drop might be around the corner. But let’s look at what the data actually says.

While home price growth has cooled compared to recent years, that doesn’t mean prices are about to tumble. According to the National Association of Home Builders (NAHB):

“House price growth slowed . . . partly due to a decline in demand and an increase in supply. Persistent high mortgage rates and increased inventory combined to ease upward pressure on house prices. These factors signaled a cooling market, following rapid gains seen in previous years.”

In short, the pace of growth is moderating—not reversing. And most experts still expect prices to rise modestly. In fact, the average of eight major forecasters projects national home values will increase by 1.5% to 2% in 2025.

So, if you're holding out for a dramatic drop in home prices, most experts agree—that scenario just isn't on the horizon.

Yes, a few markets are seeing slight declines, but the average dip is around -3.5%, which is a far cry from the nearly 20% plunge we saw during the 2008 housing crash. And when you zoom out, even those small adjustments barely move the needle compared to the bigger picture: According to the Federal Housing Finance Agency (FHFA), home prices are still up 55% nationally over the past five years.

The bottom line? Prices aren’t crashing. They're still rising—just at a slower pace. Some analysts think they may level off in certain areas, but others could still see growth. The key is: it all depends on your local market. That’s where working with a knowledgeable real estate pro makes all the difference.

What About Mortgage Rates?

Another common belief among buyers is: I’ll just wait until rates come down. But that strategy might backfire. As Yahoo Finance recently noted:

“If you’re looking for a substantial interest rate drop in 2025, you’ll likely be left waiting. The latest news from the Federal Reserve and other key economic data point toward steady mortgage rates on par with what we see today.”

Translation? Trying to perfectly time the market could leave you stuck on the sidelines. Most forecasts suggest rates will remain in the 6% range, potentially settling in the mid-6s by the end of the year.

And the truth is—rates aren’t expected to change drastically anytime soon. So if life is pushing you to make a move, let’s talk strategy. Waiting for a major drop that’s unlikely could mean missing out on the right opportunity now. Your goals shouldn’t stay on hold based on wishful thinking when the data points to stability, not surprises.

That’s why partnering with a real estate pro who tracks the economic indicators that impact mortgage rates—like inflation and policy changes—is more important than ever. Staying ahead of those shifts can give you a real advantage in this market.

For Buyers and Sellers

Whether you're buying, selling, or trying to do both, this isn't a market for guessing games—it’s a time to be strategic. Home prices are still climbing (just at a slower pace), and mortgage rates are likely to hold steady. All signs point to a cooling, not a collapse—and making smart moves now can put you ahead before conditions shift again.

Bottom Line

If you're thinking about making a move, the smartest approach is to stay focused on your personal goals—not just the headlines—and team up with a real estate professional who understands how to navigate the changes happening in your local market. National news may give a broad view, but real estate is always local, and your next step should be based on your timing and needs.

Let’s connect so we can take a closer look at what’s happening in your neighborhood and put together a clear, strategic plan tailored to you.