High mortgage rates and the rising cost of homes affected the housing market this year and additional changes may be on the horizon in 2025, according to Zillow. The real estate marketplace website released its latest outlook for homes in a new market report noting that a potential slow decline in mortgage rates in 2025 may result in gradual growth for both sales and home price appreciation.
Zillow’s outlook for 2025 predicts that there will be roughly 100,000 more sales for homes compared to 2024. Given the unpredictable declines in mortgage rates, Zillow explains that this can be the motivation needed for consumers to be ready to make a move to purchase a home when the opportunity is there. This in part has to do with new developments for the 2025 housing market, which Zillow describes as still normalizing following the pandemic.The report also found that the 'total for-sale' housing inventory is slowly improving after the pandemic but could improve in 2025, but it depends on what the mortgage rates will be. Meanwhile, consumers searching for homes during the winter months may have a chance to find a deal in a housing market that's becoming more beneficial for consumers. According to Zillow, competition for homes has slowed nationwide in 36 of 50 U.S. cities from October to November this year