BiggerPockets Daily Where Home Prices Are Likely to Go This Year
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Jan 31, 2025 Home prices are showing weakness with one in three listings seeing price cuts. This could signal a broader market correction. Altos Research data reveals why sellers are lowering prices and highlights growing inventory. The impact of high mortgage rates and sluggish sales is examined, alongside a glimpse at future affordability in 2025. Plus, there's a focus on the surprising positive aspect within the market as experts analyze shifting trends and the potential for improvement in the coming months.
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Home Price Weakness
- One-third of listed homes have seen price cuts, signaling suppressed prices going into spring.
- This marks the first year-over-year price decline since early 2023.
Housing Market Dynamics
- The housing market's affordability crisis is driven by shortages, high prices and mortgage rates, and subsiding demand.
- Migration-driven demand, especially in Florida and Texas, significantly inflated prices, followed by increased development.
Mortgage Rate Impact
- The Federal Reserve's rate cuts haven't yet impacted the housing market, but mortgage rates might decrease in the coming months.
- This could break the "lock-in effect," where homeowners with low mortgage rates hesitate to sell due to higher current rates.