Home prices will go up a little bit next year. If you sell your house, you might get about 3% more money than today. But it depends on where you live.
Some cities will do better than others. Places like New Haven and Hartford will see homes sell for more. But homes in New Orleans and San Francisco might sell for less money than before.
Right now, it's hard for people to buy homes. Banks want a lot of money in interest – about 7%. This means many sellers have to lower their prices. One in four homes sells for less than what the seller first wanted.
More homes are for sale now, which helps buyers. Sellers are also more willing to work with buyers on price. Still, buying or selling a home is not easy. Whether it's a good time to buy or sell depends on your city.
National Housing Market Forecast Overview
Home prices in America will grow slowly in the years ahead. For 2024, prices will go up by 2%. Then they'll rise by 1% more in early 2025. These numbers are higher than what experts thought before.
Many people are cutting their home prices to sell them. In fact, more than 1 in 4 homes for sale now cost less than when they first went on the market. This is the most price drops we've seen since 2018.
Homes are still hard to buy for many people because they cost so much. But there's hope. Over time, prices may not rise as fast, and loans might get cheaper. This could help more people buy homes.
Top Growing Regional Markets
Housing markets are growing fastest in two main areas right now.
In the Northeast, cities like New Haven and Hartford in Connecticut, and Syracuse in New York are doing very well.
Down South, Knoxville in Tennessee is growing the most at 4.2%. McAllen in Texas is also doing great, with 2.6% growth.
This is new and different from before, when cities in the West were growing the most.
Northeast Markets Lead Growth
The Northeast housing market is doing very well. Boston and New York are growing faster than other U.S. cities. Housing prices may go up by 2% to 4.4% in 2025.
There aren't many homes for sale right now. Many people have good jobs here. More people want to buy homes than there are homes to buy. This makes prices go up.
Some folks are moving to smaller cities like Philadelphia and Providence. These cities cost less but are still near big cities with jobs. Hartford is growing too, just more slowly.
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If you want to buy a home here in 2025, you might pay less for your loan. But homes in these big cities still cost a lot of money.
Southern Cities Show Promise
The South is growing fast! More people want to live in warm cities like Dallas, Miami, Houston, and Tampa. These sunny cities are doing very well.
Dallas is the best place to build and buy homes right now. Many people are moving there to work. In fact, 11 out of every 100 new jobs in Dallas came in the last three years.
Miami is the second-best city. Lots of people are moving there from other places. Houston has many different types of jobs. Tampa is great for people who work from home.
Austin has the most new jobs. For every 100 jobs there three years ago, they now have 17 new ones!
There are two things to watch out for. First, storms and floods make house insurance cost more. Second, workers are building too many new homes. By next year, they will add 500,000 new places to live.
But these cities are still good places to buy homes. They help businesses grow and make it easy for people to move there.
| City | Best Thing | Why It Grows |
|---|---|---|
| Dallas | Best City | More Jobs |
| Miami | Second Best | New People Moving In |
| Houston | Many Jobs | Good for Business |
| Tampa | New Homes | Work from Home |
| Austin | Most New Jobs | Fast Job Growth |
Price Decline Predictions
Home prices are going down in some places. In New Orleans, houses may cost 5.9% less soon. People in Baton Rouge will see home costs drop by 3%. San Francisco homes could also get cheaper by 3.6%.
This is happening because loan rates keep changing. More houses are for sale now too. Many people are lowering their prices to sell homes. In fact, one in four homes on Zillow had price cuts in July.
While some areas see lower prices, most U.S. homes will still cost more next year. Home costs across the country may go up by 2.6% in 2025.
Regional Price Drop Hotspots
Home prices will fall the most in places near oceans and in the South by 2025. New Orleans will see the biggest drop, with homes losing about 6% of their value. San Francisco homes will cost 4% less. In Baton Rouge, prices will fall 3%. Austin and Honolulu will also see homes get cheaper.
These cities share the same problems. Houses cost too much for many people to buy. There are more homes for sale now. More sellers are lowering their prices to find buyers. This is happening a lot on the West Coast and in the Southwest.
Many people who want to buy homes there can't afford them. While not all cities will see falling prices, these areas will see the biggest drops as homes stay too costly for buyers.
Understanding Value Depreciation Factors
Home prices might drop in the next few years. Right now, bank loans cost a lot – about 7% interest. This makes it hard for people to buy homes.
Many sellers are lowering their prices. In fact, more than 1 in 4 homes on Zillow had price cuts this summer. This hasn't happened since 2018.
Home values went up by about 5% last year. But things are changing. More homes are for sale now. They sit on the market longer. Fewer people are trying to buy the same house.
This means prices won't go up as much. By next summer, home prices might only go up by 1%.
Market Correction Warning Signs
The housing market is showing signs of slowing down. More homes are getting price cuts than we've seen in six years. In fact, more than 1 in 4 homes for sale had to lower their price in July 2024.
Some big cities are seeing home prices drop the most. In New Orleans, house prices may fall by about 6%. San Francisco homes might cost 4% less. And in Baton Rouge, prices could drop by 3%.
Across the whole country, home prices will grow very slowly. From 2024 to 2025, they may only go up by 1%. This is much less than last year's rise of almost 3%.
Why is this happening? Home loans now cost a lot more, with interest rates at 7%. There are more houses for sale now. And many people find it hard to buy homes because they cost too much.
This means good news for home buyers. They can take more time to look at houses. They can also try to get better deals because sellers are more willing to talk about price.
Mortgage Rate Impact
The money it costs to buy a house will go up and down a lot next year. When rates drop, you might want to get a new loan to save money. Keep an eye out for these changes.
More people will want to sell their homes next year. This means you can find more houses to pick from. You might also get a better deal when you buy. In some parts of the country, like the Southwest, buyers have more power now.
Many homes are getting cheaper. When you look at houses on Zillow, you'll see lots of price cuts. This means sellers want to make deals.
As prices get better and loans cost less, you can buy more house for your money. Just take your time and look around for the best deal.
Inventory Trends Across Markets
Home prices are dropping in many cities across America. More houses are for sale now than last year. Many sellers are lowering their prices to find buyers.
Different cities show different trends. Some places like New Orleans and San Francisco have falling prices. But other cities like Knoxville and New Haven see prices going up.
Cities in the Northeast, like Syracuse and Hartford, show the biggest price gains. Cities in the South, like Austin and Baton Rouge, have weaker housing markets.
These changes happen because each city has its own mix of buyers and houses for sale. This will affect home prices in each area until 2025.
Buyer-Seller Market Dynamics
The housing market is changing. More homes are for sale now. Many sellers are lowering their prices to find buyers.
Home loans are costly right now. This makes it hard for people to buy homes. But good news – costs may go down soon as the economy gets better.
If you want to sell your home, you need to think hard about your price. Some cities like Knoxville see home prices go up. Other cities like New Orleans see prices drop.
Look at what homes sell for in your area before you set your price.
If you want to buy a home, you have more choices now. You can take more time to look and pick the right home. Sellers are more willing to work with you on price.
Market Recovery Indicators
The housing market is getting better, but slowly. From next summer to the year after, home prices will go up by less than 1%. This is good news, as it means prices won't jump too high too fast.
Some cities will do better than others. Places like Knoxville and New Haven will see more growth. But cities like San Francisco and New Orleans might see prices drop.
The Southwest area is doing well and offers good chances to buy.
As prices stop rising so fast and loans get cheaper, more people can buy homes. Both home buyers and sellers will have an easier time, but the market will still take time to get back to normal.
Regional Growth Pattern Shifts
More people are moving to new places across America. Home prices will go up a bit – about 3% – in most areas next year.
The Southwest has lots of homes for sale now. This means people who want to buy homes there can find good deals.
Some cities will see home prices drop. In New Orleans and San Francisco, prices will go down. But other cities like Knoxville and New Haven will see prices rise.
The Southeast has many homes for sale right now. The Southwest will soon be the same way.
Many things affect home prices:
- Homes cost a lot to buy
- Food and gas don't cost as much as before
- New apartment buildings are being built
- Rent prices are changing
These changes are happening slowly, just like they did this year.
Conclusion
The housing market in 2025 will stay steady but face some bumps. Home prices will go up a bit – about 4%. This means homes will cost more, but not by a lot. Some areas will see better deals than others. If you want to buy or sell a house, look at what homes cost in your town. Watch out for high loan costs and fewer homes for sale. Pick the right time and place to make your move.
