Feb 2025 Housing Market Update: Are Our Predictions Already Wrong?

BiggerPockets Real Estate Podcast

BiggerPockets

Education, Business, Investing

4.8 • 16.5K Ratings

🗓️ 14 February 2025

⏱️ 33 minutes

🔗️ Recording | iTunes | RSS

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Summary

The 2025 housing market has already defied most expectations, but a worrying “shift” could throw everything off track. Home prices keep rising in every major metro—even with interest rates stuck in the sevens. It seems that nothing can stop the wave of demand hitting home sellers even as affordability reaches lows we haven’t seen in decades. But what could be the housing market’s kryptonite—the one thing that could lead to lower prices and distress in the market? Today, we’re giving you a Q1 housing market update with the latest data coming in from January 2025, sharing must-know metrics about home sales, prices, mortgage rates, buyer demand, and even mortgage delinquencies. Is Dave already off on his 2025 housing market predictions? He could be, as housing has seen unexpected strength despite last year’s big election, inflation rising once again, and interest rates more than double what they were just a few years ago. Will we see mortgage rates (and prices) drop at any point this year? What’s the one thing that could flip this housing market? We’re getting into the mystery metric you MUST watch to know what’s coming next. In This Episode We Cover: A Q1 2025 housing market update: prices, rates, demand, inventory, and more! One troubling metric that could spell pain for the housing market in 2025 The markets where inventory is exploding, but does that mean prices will fall? Is there a chance that mortgage rates will drop this year, or has the Fed paused for good? The often overlooked (and cheap!) real estate markets seeing sizable home price appreciation And So Much More! Links from the Show Join BiggerPockets for FREE Let Us Know What You Thought of the Show! Ask Your Question on the BiggerPockets Forums BiggerPockets YouTube Try REsimpli, The Only All-In-One Real Estate Investor CRM Software That Helps You Manage Data, Marketing, Sales, and Operations Reserve Your Spot at BPCON2025 and Get $100 Off Your Ticket Grab Dave’s Book, “Start with Strategy” Find an Investor-Friendly Agent in Your Area New Tariffs Mean Much More for Mortgage Rates Than You Think Connect with Dave Check out more resources from this show on BiggerPockets.com and https://www.biggerpockets.com/blog/real-estate-1083 Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? Email [email protected]. Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	Was I wrong about the 2025 housing market?
0:03.1	Most of my predictions have been reliant on this one metric not shifting that much.
0:08.5	But just a month into 2025, it's starting to shift.
0:12.2	So what does that mean about the housing market?
0:14.3	Today, we're getting into it.
0:26.7	So at a high level, the housing market continues to defy expectations as prices increase despite higher interest rates, growing inventory, and renewed inflation concerns.
0:31.8	But will that continue?
0:33.0	Or do the shifts that I'm seeing in this one key metric I've been telling you all to pay attention to mean that the market is heading for a downward shift?
0:42.1	Today, we're diving into our Q1 housing market update.
0:46.2	Hey, everyone, it's Dave.
0:47.5	And today we're taking a look around the entire industry.
0:51.8	We're talking about inventory.
0:53.0	We're talking about interest rates.
0:54.6	And again, we're going to talk about this one metric that has me questioning my own predictions
0:59.1	for the year. I'm going to report on the data. I'll give you my analysis and opinion.
1:03.5	And I will make some updated predictions on how this year is going to shape up. Let's get into it.
1:09.4	We're going to start with the basics and just talk about the high-level stuff that everyone
1:13.8	cares about, like mortgage rates, prices, inventory, all that.
1:16.8	First things first, prices, at least according to Redfin, are still up a resounding amount,
1:22.3	4.8% year over a year. Just for reference, the average, the long-term average appreciation rate is around
1:29.7	3.4%. A normal year in the housing market is when it keeps pace with inflation. So that would be
1:36.2	around 3% for last year. So prices were good, according to Redfin outpaced inflation in 2024.
	...

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