Real Estate in 2025: Why This Could Be Your Year to Buy or Sell

As we approach 2025, the housing market is brimming with changes and opportunities. Insights from the National Association of Realtors (NAR) and Brian Buffini’s predictions give us a clearer picture of what’s ahead. Here’s what you need to know to stay informed and make the most of the evolving real estate landscape.

1. Existing and New Home Sales Are on the Rise

Good news for sellers! Existing home sales are projected to grow by 9%, while new home sales are set to increase by 11% in 2025. This uptick signals a rebound in buyer activity and highlights the increasing demand for homes in diverse markets. Whether you’re looking to list your property or buy a newly built home, now’s the time to prepare.

2. Home Prices Are Stabilizing

Median home prices are expected to increase by a modest 2%. This stabilization offers buyers some relief after years of rapid price growth while still providing sellers with an opportunity to benefit from rising equity.

3. Mortgage Rates Near 6%

Although mortgage rates are projected to hover around 6%, they remain competitive compared to historical trends. Buyers should act swiftly to lock in rates, while sellers can capitalize on the steady demand fueled by these reasonable borrowing costs.

4. Job Gains Fuel Market Confidence

With nearly 2 million jobs expected to be added in 2025, economic growth will play a pivotal role in driving real estate activity. This job expansion translates into more potential buyers entering the market, boosting overall confidence.

Recent data from Redfin shows the number of pending home sales that fell out of contract in the latter half of 2024. Approximately 226,000 contracts fell out of escrow during July to October alone, underscoring the importance of working with an experienced real estate professional to navigate these challenges.

Key Demographic Shifts to Watch

Median Age of Homebuyers and Sellers Is Reaching New Highs

• The median age of homebuyers has climbed to 56 years, marking an all-time high.

• First-time buyers are entering the market at 38 years, up from 35 years last year.

• Sellers, on average, are now 63 years old, also setting a record high.

These trends highlight the growing influence of empty nesters and retirees in the market. Sellers, particularly those in this age group, are in an excellent position to leverage these dynamics.

Multi-Generational Homes on the Rise

A record 17% of buyers are purchasing multi-generational homes to accommodate extended families. This reflects shifting preferences toward shared living spaces and underscores the need for properties with flexible layouts.

Fewer Homes Have Children in Residence

• 73% of buyers and 77% of sellers reported no children under 18 living in their homes.

• Empty nesters and those without children are playing a more significant role in today’s housing market, driving demand for smaller, more manageable homes or properties that suit their evolving lifestyles.

Buyer Behavior Trends

All-Cash Buyers Set a New Record

A remarkable 26% of all transactions are now conducted by all-cash buyers, the highest share ever recorded. If you’re planning to sell, catering to cash buyers by ensuring your property is move-in ready can make all the difference.

First-Time Buyers Decline

First-time buyers now represent just 24% of the market, down from 32% last year. While this marks an all-time low, it presents an opportunity for experienced buyers and investors to step in and navigate the market with confidence.

FSBO Sales Hit Record Lows

For Sale By Owner (FSBO) transactions account for only 6% of sales, another all-time low. Historically, FSBO sales averaged around 9%. This continued decline reinforces the value of working with an experienced real estate professional to handle the complexities of buying or selling a home.

73% of Realtors Remain Committed

While 73% of Realtors are confident they will stay in the business over the next two years, the data also reflects a notable shift in the industry. Selecting a Realtor with proven dedication and resilience ensures you receive expert guidance in a dynamic market.

What This Means for You

For Sellers:

If you’re considering selling, the combination of rising sales, stabilized prices, and a strong job market makes 2025 an ideal year to list. Focus on marketing your property to appeal to empty nesters, retirees, and multi-generational buyers, as these groups are driving much of the activity.

Additionally, data from Redfin highlights the importance of properly managing transactions. Nearly 59,000 contracts were canceled in July 2024, with another 56,000 contracts falling through in June 2024. Working with an experienced agent minimizes the risk of cancellations and ensures a smoother process.

For Buyers:

With mortgage rates near 6% and stabilizing home prices, now is a great time to explore your options. Whether you’re a seasoned buyer or looking for a multi-generational home, aligning with a skilled real estate agent will ensure you make the most informed decisions.

An insightful look at agent production reveals that 47% of agents sold zero homes last year. Partnering with a top-performing agent ensures you’re backed by expertise and experience.

As always, I’m here to help guide you through the real estate market and achieve your goals. Ready to explore your options for buying or selling in 2025? Contact me today at 719-922-0102 or visit www.NicoleStromRealtor.com to get started!

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