Experts see the 2025 housing market as ‘more of the same’

The housing market remains challenging for buyers in 2025, except in certain markets where homes are more affordable - Image (c) ConsumerAffairs

High prices and rising mortgage rates will continue to challenge buyers

With home prices still rising in many areas of the U.S., affordable housing will remain one of the most pressing consumer and economic issues in 2025, especially if mortgage rates remain elevated.

There are fewer homes for sale, which has put upward pressure on prices. In November, the National Association of Realtors reported the median price of an existing home was $406,100, up 4.7% from one year ago.

Industry experts quizzed by ConsumerAffairs don’t expect much improvement for buyers in the months ahead.

“I think the housing situation will likely remain tight in 2025, especially in high-demand urban areas like Miami, New York, and San Francisco,” said Andy Saintilus, the founder of We Buy Doors, a real estate investment company in Miami. “While interest rates may stabilize and new construction efforts increase, the gap between supply and demand is substantial and will take time to resolve.”

Worse before it gets better

Jonathan Klemm, CEO of Chicago-based Quality Builders, thinks the market will get worse before it gets better, although some markets may offer exceptions.

“There are areas that offer more opportunities to buyers but these will not be your Tier 1 cities, Klemm , told ConsumerAffairs. “It will be in the Southeastern/Appalachian region like Huntsville, Ala, Northeast Tennesse, Northwest Arkansas, Louisville, Ky., and so on.”

“For buyers, some areas stand out as great opportunities,” said Michael Severns, of The Severns Group at Keller Williams Main Line in Philadelphia. “Harrisburg, Pa., for example, is fantastic for first-time homebuyers. It’s affordable, with a strong economy and promising growth. Rochester, N.Y., also offers reasonably priced homes and a solid local economy. In the South, places like Villas, Fla., combine affordability with a growing market. These areas have that perfect mix of value and opportunity.”

People will move to find an affordable house

During the pandemic, home prices surged in markets like Austin, Phoenix and Nashville because mortgage rates were low and remote work was common. Today, there is a growing gap between prices in those markets and smaller cities that didn’t see nearly as much price appreciation. 

Melanie French, the CEO of RR Living, a Dallas property management company, said that is likely to entice many people to move to those places, even if they have to look for a new job.

“In fact, it’s no longer just ‘a consideration’—it’s becoming the deciding factor,” French told us. “With rising prices and limited inventory, people are carefully weighing their housing options before making any moves. For many, relocating to areas where they can secure more affordable, spacious, and high-quality housing is a priority.”