Market Data 
- The US housing market might be much more friendly to homebuyers in 2025.
- Home sales should rise significantly as inventory grows and prices inch higher.
- Here are 10 real-estate markets that could see a surge of activity next year.
Homebuyers should stock up on champagne — and not just for New Year’s Eve.
Next year may present long-awaited opportunities for aspiring property owners to trade their apartments for homes, or for families to get the upgrades they’ve been pining for. There’s a growing sense among real-estate analysts that an extended home sales contraction will snap in 2025 as housing inventory rises and mortgage rates fall.
“Homebuyers will have more success next year,” said Lawrence Yun, the chief economist at the National Association of Realtors, in a statement about the firm’s 2025 outlook. “The worst of the affordability challenges are over as more inventory, stable mortgage rates, and continued job and income growth pave the way for more Americans to achieve homeownership.”
Housing market transactions will soar 7% to 12% in the year ahead to 4.5 million units before an even larger 10% to 15% jump in 2026, according to the NAR. New home sales are expected to climb 11% next year and 8% the year after.
Earlier this month, real-estate brokerage titan eXp Realty’s CEO told Business Insider that sales could advance 10% in 2025, though Realtor.com called for a comparatively modest 1.5% gain.
Home sales have tanked in the years after the post-pandemic boom, so those upbeat calls may sound like wishful thinking, especially coming from realtor trade associations and brokerages.
But a home sales boom seems plausible, based on what should be healthy supply and demand.
Property supply has risen significantly in recent months from startlingly low levels, and housing starts are also in a long-term uptrend following a post-housing-bubble construction bust.
That inventory uptick will keep property price growth in check at only 2% in each of the next two years, the NAR predicted, which would translate to a median existing-home price of $410,700. And buyers may also move off the sidelines as mortgage rates drift toward 6% from around 7%, the firm added.
“If rates stabilize around 6%, about 6.2 million households can once again be able to afford median-priced homes, compared to the current constraints with rates near 7%,” the NAR noted.
Slower home-price growth and lower mortgage rates will go a long way toward easing the affordability crisis that has plagued the US since the pandemic. Just over a year ago, buyers suffered through the least affordable quarter since 1985. That may soon be a distant memory.
10 hot real-estate markets
Home sales should surge across the US next year, especially in a healthy economy with solid job gains. However, researchers at the NAR expect certain cities to be far busier than others.
Buyers will flock to 10 top housing markets in 2025 due to a combination of rising home supply, manageable mortgage rates, and healthy local economies, the firm said. Healthy demand should underpin further home-price appreciation for owners in those metropolitan areas.
These soon-to-be-hot markets share several similarities, including strong property price growth since the pandemic, a sizable supply of starter homes, positive net migration, and an outsized share of out-of-state movers who are buying homes. Other factors were a market’s job growth, mortgage rates, how long most homeowners had been there, and the share of millennial renters who could buy. The NAR outlined its full methodology for this exercise in a press release.
Below are the 10 real-estate markets that the NAR is bullish on next year, along with select economic and demographic considerations.
Along with each metro area is its home price growth in the last five years, starter homes as a share of total inventory, the share of homeowners who’ve been in place for more than 16 years and therefore may be ready to sell, net migration ratio, the share of out-of-state movers purchasing homes, job growth since late 2019, and commentary from the NAR.
