The US housing market is expected to show signs of improvement in 2025, driven by lower mortgage rates and rising demand. Despite a slow start to the year, home sales are predicted to rise by 7-12% nationwide, with an 11% increase for new units.
Analysts attribute this growth to changing mortgage rates, which will likely stay above 6%, but still provide buyers with some breathing room. The Southeast region is expected to remain popular due to its warm climate and ample housing inventory. Cities such as Charlotte, North Carolina; Knoxville, Tennessee; and Lexington, Kentucky, are among the top spots for homebuyers in 2025.
On the other hand, states with high taxes, such as California, Illinois, and New York, may see continued outflow of residents, who will try to preemptively move before state and local tax deductions expire at the end of 2025. The nation’s capital, Washington, DC, is also expected to remain competitive but with tempered growth.
According to real-estate expert Jonathan Miller, buyers will continue to seek affordable markets with abundant inventory, which may lead to surges in smaller cities like New Haven, Connecticut. As the market continues to evolve, it’s essential to stay informed about trends and adjust your strategy accordingly.
Source: https://www.businessinsider.com/real-estate-top-markets-housing-outlook-2025-mortgage-rates-miller-2024-12