More Home Buyers Expect Rosier 2025 Housing Outlook
The housing market could open up more opportunities to home buyers in the new year and lead to a housing rebound after two years of sluggish sales, housing economists said on Thursday during the National Association of REALTORS®’ Real Estate Forecast Summit. During the virtual summit, NAR released its 2025 housing forecast, predicting stronger home sales (rebounding after hitting a 15-year low this summer), moderating but still increasing home prices, a greater number of homes coming up For Sale—both newly built and existing—as well as stabilizing mortgage rates.
Home Mortgage Purchase Applications Highest Since February
The Mortgage Bankers Association (MBA) released its weekly application survey results on Wednesday. The highlight was a 12.43% increase in purchase applications from the previous week. That brought the purchase index to the highest levels since February.
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Federal Housing Finance Agency (FHFA) Announces Conforming Loan Limit Values for 2025
The Federal Housing Finance Agency (FHFA) announced the conforming loan limit values (CLLs) for mortgages acquired by Fannie Mae and Freddie Mac (the Enterprises) in 2025. In most of the United States, the 2025 CLL value for one-unit properties will be $806,500, an increase of $39,950 (or 5.2 percent) from 2024.
Economic Developments – December 2024: Existing home sales will remain near 30-year lows, but location matters
Fannie Mae forecast existing home sales to total 4.25 million in 2025, an improvement of 4.8 percent compared to our expected 2024 sales pace of 4.06 million, but still down 20.3 percent compared to 2019. We expect the increased inventory of homes available for sale will drive a modest improvement in existing home sales next year. According to the National Association of Realtors, the total number of homes available for sale at the end of November was 1.37 million units, up 19.1 percent from a year prior. However, given our mortgage rate outlook for rates to stay above 6 percent in 2025, we expect both constrained affordability conditions and the lock-in effect will continue to be the dominant themes limiting the recovery of existing home sales in 2025.
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