Housing market trends
Keep your finger on the pulse of the housing industry.
The data shown in By the numbers is current as of March 3, 2025.
Mortgage minute with Tony Cardoza
The housing market is currently experiencing rate stabilization, which is likely to continue through 2025. Despite optimism around the Federal Reserve’s September 2024 rate cut, a continued lock-in effect is expected with rates predicted to average 6.3% through 2025 and end the year at 6.2%.3 The good news is inventory of both resale and new-home-builds are increasing.
Tony Cardoza, U.S. Bank national builder program manager, notes that any potential buyers ready to make the jump should consider the benefits and potential savings of purchasing a new build in today’s market. “With rates seeming to stabilize and inventory on the rise, we’re seeing some resale properties come back onto the market. The main issue we’re seeing with resale properties, as compared to purchasing a new build, is that new builds are heavily incentivized in the current market. Those incentives are used to buy rates down, which makes purchasing a new build potentially more affordable.”
For real estate agents looking to get their buyers the best deal, it’s important to know that new builds aren’t just for seasoned buyers, especially given the heightened incentives. New builds are prevalent in available inventory, and builders are eager to move them off the market to make room for continued production.
Along with affordability, Cardoza highlighted additional perks of purchasing a new build. “The maintenance and upkeep of a new home are both under warranty, which is often not the case with resale. Buyers are walking into a turnkey home, with no renovations or other projects that drive up the cost of moving into an existing home.”
“There is definitely opportunity for agents to do more new build business. Real estate agents who want to break into deals with new home builders should start by getting to know the builders in their market. Research the builder’s product offerings and understand their buyer profiles. Getting to know the builder’s structure for dealing with outside agents is a key way to gauge if the partnership will be a good fit.”
Mortgage market quick takes
Quick take:
It’s important to look at housing market trends in the context of the broader economy. Despite recent weakness in single-family home sales, many homebuyers are in a strong financial position. According to the Bureau of Labor Statistics, the national unemployment rate remained strong in February at 4%.4
- For first-time homebuyers in particular, there is more focus on state programs that offer subsidized interest rates or down payment assistance programs.
- Home prices will grow an additional 3.7% through next year, after rising 4% in 2024 and 1.1% in 2023. The supply of homes for sale will continue to improve, rising 11.7% in 2025, the forecast predicts.3
- More house hunters are starting their search as the new year kicks off. The Homebuyer Demand Index, a seasonally adjusted measure of tours and other buying services, posted a small 2% increase from a month earlier during the week ending January 5, and it’s also up 2% YoY.5
- New home construction will continue to expand in 2025, increasing 13.8% over 2024 to about 1.1 million new units started this year, according to the forecast.6
We’re knowledgeable about current market trends and ready to help.
As pros in the mortgage business, we’re great listeners who take the time to get to know your clients and offer guidance based on their individual needs. Connect with your preferred U.S. Bank mortgage loan officer or find a mortgage loan officer in your area to get the conversation started.
We’re dedicated to helping your clients land the home of their dreams.
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