Looking into 2025

2024: A Roller Coaster Year

2024 was a mix of highs and lows for the mortgage market. While inventory increased and buyer demand showed growth, fluctuating interest rates created uncertainty. The year saw both periods of high activity when rates dipped and slower periods when rates rose. This sets the stage for a more stabilized market in 2025.

2025: Stabilization in Sight

Experts predict that 2025 will bring more stability to the housing market. Interest rates are expected to hover between 5.5% and 6%, providing predictability for buyers and sellers. This stable range could encourage increased activity as people adjust to current market conditions.

Growth in Housing Inventory

The housing supply is gradually recovering. From an all-time low of 250,000 homes in 2022, inventory has risen to over 680,000 homes in 2024. While this is still below the historical average of one million homes, the increase helps alleviate some pressure on the market. With more sellers entering the market, buyers are likely to find more negotiable deals in 2025.

Advice for First-Time Buyers

First-time homebuyers should focus on preparation:

• Credit Scores: Aim for a credit score of at least 640 to qualify for favorable FHA loans and down payment assistance.

• Savings: Even with assistance programs, buyers should save for earnest money and potential closing costs.

• Start Early: Begin preparing months in advance to address any credit or financial issues before purchasing a home.

Check out: Best VA Loan Lender

Opportunities in 2025

Motivated sellers and increased inventory create a favorable environment for buyers. Sellers may offer concessions like closing cost assistance, making it easier for buyers to enter the market. Strong negotiation skills and working with experienced agents will be key to securing the best deals.

A Balanced Market Ahead

2025 is shaping up to be a year of balance. Stabilized rates, recovering inventory, and steady buyer demand create an environment where both buyers and sellers can thrive. Those who stay informed and act strategically will be positioned for success in the year ahead.

Listen to the Mortgage Heroes Podcast on your favorite platform.