As we look ahead to 2025, it's essential to understand what experts are projecting for the housing market, especially if you're considering buying or selling a home in the Conejo Valley. Having a clear picture of what’s anticipated can help you make the best decision for your homeownership goals.

Here’s an early look at the latest projections for mortgage rates, home sales, and prices for 2025.

Mortgage Rates Are Projected To Slightly Decrease Mortgage rates significantly influence the housing market, and forecasts from Fannie Mae, the Mortgage Bankers Association (MBA), the National Association of Realtors (NAR), and Wells Fargo suggest a gradual decline in mortgage rates throughout 2025. This is expected due to easing inflation and a slight increase in unemployment, which are signs of a strong yet slowing economy. Many experts believe these indicators will prompt the Federal Reserve to lower the Federal Funds Rate, potentially leading to lower mortgage rates. As Morgan Stanley notes:

“With the U.S. Federal Reserve widely expected to begin cutting its benchmark interest rate in 2024, mortgage rates could drop as well—at least slightly.”

More Homes Are Expected To Sell Experts anticipate an increase in both the supply and demand for homes as more buyers and sellers, previously hesitant due to higher rates, decide to enter the market. This is one key reason why experts project a rise in home sales for 2025.

According to forecasts from Fannie Mae, MBA, and NAR, total home sales are expected to climb slightly, with an average of around 5.4 million homes anticipated to sell in 2025. This represents a modest uptick from the lower sales figures seen in 2023 and 2024, with approximately 4.8 million homes sold in 2023 and an estimated 4.5 million in 2024.

While the slight decrease in mortgage rates may not flood the market with buyers and sellers, it will encourage more activity. This means more homes available for sale and increased competition among buyers.

Home Prices Will See Moderate Growth With more buyers ready to enter the market, upward pressure on home prices will persist. The latest price forecasts from ten of the most trusted sources in real estate suggest an average national price increase of about 2.6% in 2025. While there's some variation in predictions, experts agree that home prices will continue to rise moderately at a slower, more typical rate. However, it’s important to remember that prices will vary by local market, including within the Conejo Valley.

Bottom Line Understanding the 2025 housing market projections can help you plan your next move. Whether you're buying or selling, staying informed about these trends ensures you make the best possible decision. Let’s connect to discuss how these forecasts could impact your real estate plans in the Conejo Valley.