The 2024 U.S. real estate market started off promising, with mortgage rates cooling from 2023 highs. However, by the spring, the average 30-year fixed rate was over 7% again. This brought on a slower-than-usual spring market, where many buyers took to the sidelines waiting for interest rate relief. Home sales remained relatively flat throughout the rest of the year. Will this trend continue into the new year, or will 2025 be the year buyers return?<\/p>\n\n\n\n
We talked with Kendall Bonner, eXp Realty\u2019s VP of Industry Relations, to find out what home buyers and sellers can expect for the 2025 U.S. real estate market. <\/p>\n\n\n\n
Rising costs of living\u2014with average monthly household expenses<\/a> increasing from $6,081 in 2022 to $6,440 in 2023\u2014have undoubtedly impacted younger generations\u2019 ability to purchase a home. According to the National Association of Realtors\u2019 2024 Profile of Home Buyers and Sellers<\/em><\/a>, the median age of first-time home buyers has reached an all-time high of 38, and first-time buyers made up just 24% of all buyers last year, a historic low.<\/p>\n\n\n\n As a result, next year\u2019s pool of buyers will largely consist of existing homeowners. \u201cWith the current challenges first-time homebuyers face in saving for a down payment, we\u2019re unlikely to see a significant increase in first-time home buyers unless there\u2019s a dramatic drop in interest rates,\u201d says Bonner. \u201cInstead, there will be an increase in purchases by existing homeowners, and since these buyers are also sellers, we can anticipate steady pricing as supply and demand remain relatively balanced.\u201d<\/p>\n\n\n