When Will Housing Prices Go Down? 2025 Market Predictions
Timing the housing market is a tricky prospect. Factors such as mortgage interest rates, housing inventories, the overall economy and even the weather can influence home prices.
Fortunately for homebuyers, mortgage interest rates and are likely to stay mostly predictable for the time being.
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Will the housing market crash?
It’s unlikely the housing market will crash. Regulators installed guardrails against a market meltdown after the housing crisis of 2008. But that doesn’t mean prices won’t adjust and can’t come down.
Competition tends to bring down prices, and a National Association of Realtors (NAR) report from last month suggested are at a five-year high. some over the past month. More homes for sale could mean lower prices as current homeowners make concessions to sell their properties.
Should I wait to buy a house?
There's no wrong time to buy a house. Market trends, mortgage interest rates, home prices and life events could all create the perfect homebuying conditions, whether it's your first house or your ultimate dream home.
But generally, if you need a house and your finances allow it, you should buy a house. Even if prices come down some, the difference over the life of something like a 30-year mortgage likely won’t matter that much.
Buying vs. renting
Renting a place and owning a home each have their advantages. What will matter most are your financial goals and lifestyle.
- Buying means you will have an asset, something to show for the money you’ve spent.
- Renting gives you more flexibility to move when you want to or need to, and renting generally costs less upfront than purchasing and owning a home.
- Taxes can be a concern as well, as a certain portion of mortgage interest payments is tax-deductible and can lower your tax burden, an advantage you won’t get as a tenant.
Deciding to rent or buy a home will depend largely on what you can afford, your financial goals and lifestyle.
- Are you relatively young or just starting out on your own? Renting for several reasons might be the better option. It’s generally cheaper, especially upfront, and you might not have the credit score you need to qualify for a mortgage.
- When considering whether to buy a home, you’ll want to consider how long you want to live in the area. If you plan to or need to move frequently, buying a home might not be a good financial decision for you.
- If you have long-term savings goals, it could make more sense to rent in an area that’s less expensive and put away what you can while you can.
When is the best time to buy a house?
Before you get too deep into the process of buying a house, you want to be certain you’re ready for homeownership. Given your financial circumstances, is now a good time to buy a house at this point in your life? If money’s tight or you don’t plan to stick around in one place for too long, it might make more sense to keep renting.
