How to Score a Great Deal in Today’s Housing Market (Even with High Interest Rates)
Tips to score a great deal in the 2025 housing market. Learn to leverage motivated sellers, negotiate creatively, and use innovative financing...
Navigating the 2025 Housing Market: A Mid-Year Update for Buyers and Sellers
Discover expert tips and insights on real estate lending. Stay informed with Vetted Capital’s latest blog posts for borrowers and brokers.
The Vetted Team
Apr 4, 2025
As we reach the midpoint of 2025, the U.S. housing market is experiencing notable shifts that are influencing both buyers and sellers. Understanding these changes is crucial for making informed real estate decisions.
Market Dynamics: A Shift Towards Buyers
For the first time since 2013, the number of home sellers has surpassed buyers, signaling a transition towards a buyer-friendly market. Redfin reports nearly 500,000 more homes listed than buyers, the largest gap recorded. Despite this, home prices continue to rise, with the median sales price reaching a record $414,000 in April, marking the 22nd consecutive month of growth.
Interest Rates and Inflation: Implications for Housing
The Federal Reserve’s benchmark rate remains between 4.25% and 4.5%, with mortgage rates hovering around 7%. While inflation has cooled to 2.3% in April, housing costs remain a concern. Persistent high housing expenses could prompt the Fed to consider rate hikes by year-end to maintain inflation targets.
Climate Change and Lending Practices
Climate-related risks are increasingly influencing mortgage lending. Traditional banks are becoming hesitant to approve loans in wildfire-prone areas, while fintech lenders are more willing to take on these risks. This divergence could have systemic consequences, potentially increasing financial risk for institutions supported by taxpayer-backed entities.
Regional Insights: Diverse Market Conditions
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South and West: Cities like Phoenix and Tampa are experiencing increased inventory and longer listing times, leading to more price reductions.
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Northeast and Midwest: These regions remain tighter markets with stronger price growth, reflecting a bifurcated housing market nationally.
Looking Ahead: Strategic Considerations
With the market shifting, buyers may find increased negotiating power, while sellers need to be realistic with pricing. Monitoring interest rates and regional trends will be essential for making timely and informed decisions.