A Market in Transition—But Not Without Hope
If you’ve been watching the housing market over the past two years and feeling discouraged, you’re not alone. Mortgage rates have been climbing, affordability has taken a hit, and for many would-be buyers, it’s felt like the dream of homeownership was drifting out of reach.
But here’s the good news: according to housing economists and recent data, the second half of 2025 may tell a very different story.
At the recent National Association of REALTORS® Legislative Meetings in Washington, D.C., NAR Chief Economist Lawrence Yun delivered a message filled with both realism and optimism: the market is turning a corner.
Why Sales Slowed—And What Could Turn Things Around
The past couple of years have been tough. Home sales in 2023 and 2024 hit 30-year lows due to a combination of high interest rates and limited affordable inventory. Add in inflation and uncertainty around future rate cuts, and it’s no surprise that many buyers hit the pause button.
Still, the desire for homeownership hasn’t gone away. In fact, a recent survey by the Federal Reserve Bank of New York shows that over 70% of renters would prefer to own—a clear sign that demand is just waiting for the right moment.
That moment, experts believe, is coming soon.
What’s Forecasted for 2025 and 2026?
According to Yun’s projections:
- Existing-home sales are expected to rise 6% in 2025 and another 11% in 2026.
- New-home sales, which have stayed relatively strong thanks to builder incentives, are expected to climb 10% in 2025 and 5% in 2026.
- Home prices will likely continue to rise steadily, with a 3% increase in 2025 and 4% in 2026.
While this might not sound like a dramatic rebound, it’s a meaningful and healthy path forward, especially for those thinking about buying or selling in the next 12–24 months.
Mortgage Rates: The Tipping Point
As Yun said in his presentation, “Mortgage rates are the magic bullet.”
Right now, those rates remain high, but inflation is edging closer to the Fed’s target. When inflation stabilizes, interest rates are expected to fall, possibly starting in late 2025.
That shift could unlock affordability for thousands of buyers who’ve been sitting on the sidelines—and bring renewed energy to the market.
The Long-Term Power of Homeownership
Despite the headwinds, homeowners have continued to build wealth. Since 2019:
- The median net worth of homeowners has risen by 45%
- Renters’ net worth has remained relatively flat, growing just 36% over the same period
- Homeowners now hold a median net worth 43 times higher than renters
These numbers show that homeownership remains one of the most powerful ways to build long-term financial stability. Helping more people—especially younger buyers—gain access to that opportunity is one of the goals economists and industry professionals are rallying behind.
Where the Market Needs to Grow
According to Realtor.com Chief Economist Danielle Hale, much of the inventory coming online still misses a key price point. The U.S. housing market needs more homes priced below $250,000 to support first-time and middle-income buyers.
Through campaigns like “Let America Build,” Hale and others are advocating for zoning reform, more accessible financing, and smarter construction strategies to bridge the affordability gap.
Reasons for Optimism
Here’s what gives experts confidence moving forward:
- 7 million jobs have been added since COVID-era shutdowns
- Wage growth (currently at 3.8%) is outpacing inflation (2.3%)
- Mortgage delinquencies remain historically low
- Applications for new mortgages are starting to climb again, even with current rates
As Yun said, “There’s a light at the end of the tunnel.”
What This Means for You
Whether you’re thinking of buying your first home, selling to downsize, or making a move within Ventura County, the key takeaway is this:
The market may be slower today, but momentum is building.
Now is the time to plan, prepare, and position yourself to act when the window opens.
If you’re ready to explore your options—or just want to understand what these trends mean for your specific situation—I’m here to help you navigate it all with clarity and confidence.
Let’s talk about your next steps—so when the market shifts, you’re already one step ahead.
