Norada Real Estate Investments

Today’s Mortgage Rates: February 25, 2025 – Rates Drop Mildly Again

by

Thinking about buying a house or refinancing your current mortgage? Well, you're definitely not alone! One of the first things anyone looking at the housing market wants to know is: what are mortgage rates doing today? So, let's cut right to the chase. As of today, February 25, 2025, the average interest rate for a 30-year fixed mortgage sits at 6.93%.

That's a tiny dip of 0.03% compared to last week. Rates are still pretty much holding steady, which means understanding where things are at right now is super important whether you’re buying your first home or just keeping an eye on your options. Let's dive into what these rates mean for you and what's happening in the mortgage world today.

Today’s Mortgage Rates February 25, 2025: Rates Drop Mildly

Breaking Down Today's Mortgage Rate Snapshot

Let's be real, numbers can be confusing, especially when you're talking about big things like home loans. But it's really about understanding the basics. Think of mortgage rates as the price you pay to borrow money to buy a house. Just like prices for groceries or gas, these rates can change. To help make sense of it all, here’s a quick look at the average mortgage rates you'll see today for different types of loans by Bankrate:

Type of Mortgage Current Rate (%) Change from Last Week
30-Year Fixed Mortgage 6.93% -0.03%
15-Year Fixed Mortgage 6.27% 0.00%
30-Year Fixed Jumbo 7.06% +0.01%
5/1 Adjustable Rate Mortgage (ARM) 6.23% -0.03%
10-Year Fixed Rate 6.27% +0.16%

Okay, so what does this table really tell us? The 30-year fixed mortgage is the most popular choice for a reason. It gives you a steady interest rate for 30 years, which makes your monthly payments predictable. At 6.93%, it's still on the higher side compared to a few years ago, but it has eased off a little bit. The 15-year fixed mortgage has a lower rate at 6.27%, which means you'll pay less interest overall. The catch? Your monthly payments will be higher because you're paying off the loan in half the time.

Now, let's talk about jumbo loans. These are for bigger mortgages, usually when you're buying a more expensive home. The 30-year fixed jumbo rate is a bit higher at 7.06%. Then there are Adjustable Rate Mortgages (ARMs), like the 5/1 ARM. The rate starts lower (6.23% for a 5/1 ARM today), but after a set period (in this case, 5 years), the rate can change based on market conditions. Finally, the 10-year fixed rate is at 6.27%, offering a quicker payoff than a 15 or 30-year loan, but again, with higher monthly payments.

For those thinking about refinancing, meaning replacing your current mortgage with a new one, here’s how refinance rates are looking today:

Type of Refinance Current Rate (%) Change from Last Week
30-Year Fixed Refinance 6.94% +0.01%
15-Year Fixed Refinance 6.32% +0.06%
10-Year Fixed Refinance 6.30% +0.16%

You can see refinance rates are pretty close to purchase rates, with the 30-year fixed refinance at 6.94%. If you're considering refinancing, you'd want to check if the new rate and terms make sense for your financial situation, considering things like closing costs and how long you plan to stay in your home.

What's Behind These Mortgage Rate Numbers?

Mortgage rates don't just pop out of thin air. They are heavily influenced by what's happening in the wider economy, especially by the Federal Reserve (often just called “the Fed”). Think of the Fed as the central bank of the United States. One of their main jobs is to keep inflation under control. Inflation is when prices for things like groceries and gas go up over time. To manage inflation, the Fed can adjust interest rates.

Last year, to combat high inflation, the Fed raised interest rates quite a bit. This had a direct impact on mortgage rates, pushing them up. More recently, the Fed has paused on raising rates and there was even talk of cutting rates, which would usually lead to lower mortgage rates. However, as we see from today’s numbers, mortgage rates haven’t dropped dramatically yet.

Why is that? Well, it's a bit like pushing a big ship – it takes time and continued effort to change its direction. Even though the Fed might be signaling a shift towards lower rates in the future, the effects aren't immediate. Plus, there are other economic factors at play, like ongoing concerns about inflation not coming down as quickly as hoped. If inflation stays stubbornly high, it could prevent mortgage rates from falling significantly.

Figuring Out Your Monthly Mortgage Payment

Okay, interest rates are one thing, but what most of us really want to know is: what will my monthly payment be? That's where these percentages turn into real dollars and cents. Let's break down what you can expect to pay each month based on today's average 30-year fixed mortgage rate of 6.93%, for different loan amounts.

Think about it this way – your monthly mortgage payment is basically made up of principal (the amount you borrowed) and interest (the cost of borrowing). Over time, you gradually pay off the principal, and the interest rate determines how much extra you pay for the privilege of borrowing the money.

Let's look at some common mortgage amounts and their estimated monthly payments at 6.93%:

For a $150,000 Mortgage

If you're borrowing $150,000, your estimated monthly payment would be around $990.16. For many first-time homebuyers or those in areas with lower home prices, a $150,000 mortgage might be in the ballpark. That monthly payment gives you a solid idea of what to budget for housing each month.

For a $200,000 Mortgage

Stepping up to a $200,000 mortgage, your monthly payment would be approximately $1,320.22. This is a common loan amount in many parts of the country. It's important to remember that this is just the mortgage payment itself. You'll also have to factor in property taxes, homeowner's insurance, and potentially private mortgage insurance (PMI) if you put less than 20% down.

For a $300,000 Mortgage

If you're aiming for a $300,000 mortgage, expect a monthly payment of about $1,980.32. As you can see, as the loan amount increases, so does the monthly payment, and it starts to become a more significant portion of your monthly expenses.

For a $400,000 Mortgage

A $400,000 mortgage would result in a monthly payment of roughly $2,640.43. This kind of payment really highlights the importance of being financially prepared before you buy a home. It's not just about qualifying for the loan; it's about comfortably managing that payment every month for potentially decades.

For a $500,000 Mortgage

Finally, for a $500,000 mortgage, the estimated monthly payment jumps to around $3,300.54. For larger loans like this, careful budgeting and financial planning are crucial. Homeownership is a big commitment, and understanding these numbers is a key part of making smart decisions.

Here’s a handy table summarizing these monthly payment estimates:

Mortgage Amount Estimated Monthly Payment at 6.93%
$150,000 $990.16
$200,000 $1,320.22
$300,000 $1,980.32
$400,000 $2,640.43
$500,000 $3,300.54

Keep in mind, these are just estimates and your actual payment could vary slightly depending on your specific loan terms, lender fees, and other factors. It’s always best to get personalized quotes from lenders based on your own situation.

What's the Outlook for Mortgage Rates Going Forward?

So, what can we expect in the future when it comes to mortgage rates? Honestly, predicting the future is never easy, especially in the world of economics. However, experts who watch the mortgage market closely are generally expecting rates to stay in a similar range for a while. Many predictions suggest that mortgage rates will likely hover between 6% and 7% for the rest of this year.

Unless there are major surprises in the economy – like a sudden spike in inflation or a big shift in the Fed's policies – it's unlikely we'll see drastic drops in rates anytime soon. This means that if you're planning to buy a home, it's probably wise to prepare for rates to remain in this range for the foreseeable future.

It's also important to remember that mortgage rates aren’t the only factor affecting home affordability. Things like stagnant wage growth (meaning our paychecks aren't increasing as fast as the cost of living) and the ongoing shortage of homes for sale also play a big role. Even if mortgage rates were to come down a bit, these other challenges could still make homeownership feel out of reach for many people.

My Take?

The current mortgage rate environment is a bit of a mixed bag. Rates are still elevated compared to the rock-bottom levels we saw a few years ago, but they've also stabilized somewhat recently. For potential homebuyers, it means you need to be realistic about your budget, shop around for the best rates and terms, and be prepared for the long-term financial commitment of homeownership.

It's definitely a market that requires careful planning and a clear understanding of the numbers. Don't be afraid to ask questions and get help from experienced professionals – like mortgage lenders and real estate agents – to navigate this process. Buying a home is a big decision, and having good information is your best tool.

Work with Norada in 2025, Your Trusted Source for

Real Estate Investing

With mortgage rates fluctuating, investing in turnkey real estate

can help you secure consistent returns.

Expand your portfolio confidently, even in a shifting interest rate environment.

Speak with our expert investment counselors (No Obligation):

(800) 611-3060

Get Started Now

Are Capital Gains Considered Income?

by

Selling that vintage comic book collection for a hefty profit or watching your stocks soar might feel like hitting the jackpot. But when it comes to taxes, are capital gains considered income? The short answer is: yes, generally, capital gains are considered income by the IRS. However, the story doesn't end there. Let's dive into the nuances of capital gains and how they impact your tax obligations.

 

Are Capital Gains Considered Income?

Understanding how capital gains are classified for tax purposes.

📈 What are Capital Gains?

Capital gains are profits earned from the sale of an asset, such as stocks, bonds, or real estate.

🔍 Types of Capital Gains

Short-term capital gains are taxed as ordinary income, while long-term capital gains enjoy lower tax rates.

💡 Are Capital Gains Considered Income?

Yes, capital gains are considered a form of income and are subject to taxes based on their classification as short-term or long-term.

💰 Tax Implications

Depending on your income level, long-term capital gains can be taxed at rates of 0%, 15%, or 20%. Short-term gains are taxed at your ordinary income tax rate.

Understanding capital gains is essential for effective tax planning.

 

Understanding the Basics: What Exactly are Capital Gains?

Before we delve into the tax implications, let's clarify what we mean by “capital gains.” Simply put, a capital gain occurs when you sell a capital asset for a higher price than you originally purchased it for. These assets can range from investments like stocks and bonds to tangible items like real estate, art, or even your beloved comic book collection.

Let’s illustrate with an example. Imagine you bought a share of Company XYZ for $50 and later sold it for $75. This $25 increase? That's your capital gain. Conversely, if you sell an asset for less than you purchased it for, you experience a capital loss.

Why it Matters: How Capital Gains Impact Your Taxes

Now, back to our main question: Are capital gains considered income? The IRS considers capital gains as part of your taxable income, but with a twist. Unlike your regular salary, which is taxed at your ordinary income tax rate, capital gains are subject to capital gains tax rates. These rates are often lower than ordinary income tax rates, especially for assets held for longer periods.

Here's why this distinction is crucial:

  • Lower tax rates can mean significant savings. This preferential treatment of capital gains incentivizes investment and economic growth.
  • Holding onto assets longer can be rewarding. The duration for which you hold an asset (known as the holding period) determines whether your gain is considered short-term or long-term, directly impacting the tax rate applied.

Short-Term vs. Long-Term Capital Gains: What's the Difference?

The IRS differentiates between short-term and long-term capital gains, each subject to different tax treatments. Understanding this distinction is crucial for effective tax planning.

Short-Term Capital Gains:

  • Definition: Gains on assets held for one year or less.
  • Taxation: Taxed at your ordinary income tax rate, which varies based on your income bracket.

Long-Term Capital Gains:

  • Definition: Gains on assets held for more than one year.
  • Taxation: Taxed at more favorable rates than short-term gains and ordinary income. These rates are currently 0%, 15%, or 20% depending on your filing status and taxable income.

Example:

Let's say you fall into the 22% tax bracket for ordinary income. You sell some stocks that you've held for only ten months, making a $2,000 profit. This gain is considered short-term and would be taxed at your ordinary income tax rate of 22%, resulting in a $440 tax liability.

Now, imagine you held those same stocks for over a year. Instead of being taxed at 22%, your $2,000 profit would be subject to the long-term capital gains tax rate, which could be 0%, 15%, or 20% depending on your income level. This could result in substantial tax savings compared to the short-term scenario.

Exceptions to the Rule: When Are Capital Gains Not Considered Income?

While generally, the IRS classifies capital gains as income, there are some key exceptions where these gains might not be taxed, or their taxation might be deferred. Recognizing these exceptions is vital for optimizing your tax strategy.

Here are a few notable instances:

  • Selling Your Primary Residence: One of the most significant exceptions applies to profits from selling your primary residence. If you’ve lived in your home for at least two of the past five years, you can exclude up to $250,000 of capital gains from your taxable income (or up to $500,000 for married couples filing jointly). This exemption can be a major advantage for homeowners.
  • 1031 Exchange: Real estate investors can benefit from a powerful tax-deferral strategy known as a 1031 exchange. This allows them to defer capital gains taxes on the sale of an investment property by reinvesting the proceeds into a similar property.
  • Investing in Opportunity Zones: Designed to incentivize investment in economically distressed communities, Opportunity Zones allow investors to defer capital gains taxes by reinvesting profits from previous investments into designated Qualified Opportunity Funds.
  • Inherited Assets: When you inherit assets, you receive a “step-up in basis.” This means your cost basis for the asset is its market value at the time of inheritance, not the original purchase price. This provision can significantly reduce or even eliminate capital gains taxes when you eventually sell the inherited asset.

Factors that Can Influence Your Capital Gains Tax

Understanding the distinction between short-term and long-term gains and recognizing potential exceptions is crucial. However, various other factors can influence your capital gains tax liability, adding further layers to the equation.

Let's break down some of these key factors:

  • Your Income Level: Your income level plays a significant role in determining your capital gains tax rate, especially for long-term gains. Higher earners generally face higher capital gains tax rates.
  • Your Filing Status: Your filing status (single, married filing jointly, head of household, etc.) also impacts your capital gains tax rates. Married couples filing jointly often benefit from higher thresholds for the lower capital gains tax brackets.
  • Deductions and Exemptions: Various deductions and exemptions can potentially offset your capital gains, reducing your overall tax liability.
  • State Taxes: Remember that in addition to federal capital gains taxes, many states also impose their own capital gains taxes. These rates vary widely by state and can significantly impact your overall tax burden.

Minimizing Your Tax Liability: Strategies for Managing Capital Gains

While the prospect of owing taxes on your hard-earned profits might seem daunting, don't despair! By proactively employing strategic planning, you can potentially minimize your capital gains tax liability and keep more of your earnings.

Here are a few effective strategies to consider:

  • Hold Investments for the Long Term: One of the simplest yet most powerful strategies is to adopt a long-term investment approach. Remember those favorable long-term capital gains tax rates? By holding onto assets for more than a year, you unlock these lower rates and potentially save significantly on taxes.
  • Offset Gains with Losses: Did you experience capital losses on some investments? You can use these losses to offset your capital gains, effectively reducing your taxable income. This strategy, known as tax-loss harvesting, can be a valuable tool for investors.
  • Take Advantage of Tax-Advantaged Accounts: Consider utilizing tax-advantaged retirement accounts like 401(k)s or IRAs. With these accounts, you can defer paying taxes on your investment gains until retirement, allowing your money to potentially grow more significantly over time.
  • Explore Opportunity Zones: If you're seeking to reinvest capital gains, consider exploring investments in designated Opportunity Zones. These investments offer the potential for tax deferral and could be an attractive option for some investors.
  • Consult with a Tax Professional: Navigating the complexities of capital gains taxes can be challenging. Seeking guidance from a qualified tax professional can provide invaluable insights and help you develop a personalized tax plan that aligns with your financial goals.

Conclusion

Are capital gains considered income? The answer, as with many things related to taxes, is: it depends. While the IRS generally treats capital gains as income, the specific rules and rates can vary based on factors like the type of asset, your holding period, income level, and filing status. By understanding the nuances of capital gains taxes and exploring potential strategies for minimizing your liability, you can make more informed investment decisions and keep more of your hard-earned profits. Remember, proactive planning and seeking expert advice are key to achieving your financial goals.

10 Housing Market & Mortgage Trends You Need to Know in 2025

by

Thinking about buying or selling a home? You're probably wondering what's going on with the housing market and mortgage rates. In short, the housing market in 2025 is expected to be stable but still challenging. Expect mortgage rates to settle around 6.5% to 7%, home prices to keep rising moderately (3% to 4%), and affordability to remain tough, especially for first-time buyers. Keep reading to learn more about the major shifts happening now.

The housing market is always changing, and right now, it feels like we’re in a particularly interesting time. It can be difficult to navigate these waters. So let's break down the 10 trends I believe are most important for you to understand if you’re thinking about buying, selling, or just trying to make sense of it all.

10 Housing Market & Mortgage Trends You Need to Know in 2025

1. Mortgage Rates Are Finally Finding Their Footing

After what feels like a rollercoaster ride, mortgage rates are expected to level out in 2025. Experts suggest they'll likely hover around 6.5% to 7%.

  • Why this matters: Stability in rates gives both buyers and sellers a more predictable environment. It's easier to budget and make plans when you're not constantly guessing what the next rate hike might be.
  • My take: While these rates are still higher than what we saw a few years ago, the stabilization is a good sign. It gives potential buyers a chance to adjust and plan accordingly. It might not be the dream sub-4% rate, but at least it’s not constantly spiking.

2. Home Prices: Still Climbing, But Not as Fast

Good news, sort of! Home prices are predicted to keep increasing, but at a slower pace. We’re talking about an annual growth of around 3% to 4%.

  • Why this matters: This moderation is a response to the tough affordability situation. It means prices aren't skyrocketing like they were during the peak of the pandemic, but they’re still not exactly dropping.
  • My take: Even though the growth is slowing, it’s still growth. Buyers shouldn’t necessarily expect big price drops. Instead, focus on finding a home that fits your budget in the long term. This moderation can also give some buyers some time to save more for down payments.

3. Affordability: The Biggest Hurdle for Many

This is where things get tricky. Affordability remains a huge problem, especially for those trying to buy their first home. High home prices and elevated interest rates make it tough to break into the market.

  • Why this matters: A recent report noted that the typical mortgage payment is at an all-time high. That’s a lot of money each month, and it can be daunting for anyone, especially those just starting.
  • My take: This is the area that worries me the most. We need to find creative solutions to help people achieve homeownership. Maybe that means exploring different types of mortgages, down payment assistance programs, or even rethinking zoning laws to allow for more affordable housing options.

4. Inventory: Still Low, But Showing Signs of Life

The number of homes available for sale, or inventory, is expected to stay limited. However, there's a glimmer of hope: new construction is on the rise.

  • Why this matters: Low inventory keeps prices higher. More new homes being built could eventually help ease the shortage and give buyers more choices.
  • My take: New construction is definitely a positive development. But it takes time for these new homes to hit the market. Don’t expect a sudden flood of houses for sale overnight.

5. No Housing Market Crash on the Horizon

Unlike the housing crisis of 2008, the current market isn't showing signs of a major collapse. Experts point to stricter lending standards and a lack of speculative buying as reasons for this stability.

  • Why this matters: This is reassuring news. No one wants to see a repeat of the devastation caused by the previous crash.
  • My take: While a crash seems unlikely, it’s still important to be cautious. Don’t overextend yourself financially, and always do your research before making any big decisions.

6. Buyers Are Playing It Cool and Waiting for Lower Rates

Many potential buyers are sitting on the sidelines, waiting for mortgage rates to drop below 6%.

  • Why this matters: This cautious approach is keeping demand in check. Until rates come down, expect the market to be somewhat subdued.
  • My take: It's a smart move to be patient, but don’t wait forever. Rates might not plummet as much as some people hope. If you find a home you love and can afford, don't let a slightly higher rate scare you away completely.

7. Sellers Are Slowly Getting Back in the Game

While many sellers are hesitant to give up their low-rate mortgages, we're seeing a gradual increase in seller activity.

  • Why this matters: More sellers means more inventory, which could help balance the market.
  • My take: This is a positive sign, but it’s a slow process. Many homeowners are “locked in” to their current low rates, making it less appealing to sell and buy a new home at a higher rate.

8. The Housing Market: It's All Local

It’s very important to remember that regional variations can play a big role. What's happening in one city or state might not be happening in another.

  • Why this matters: It is crucial to understand that a national trend might not reflect your local market. Factors like job growth, population changes, and local regulations can all impact housing prices and sales.
  • My take: Talk to a local real estate agent who knows your area inside and out. They can give you the most accurate picture of what's happening in your community.

9. Policy Changes: A Wild Card in the Housing Market

Potential policy changes from the current administration could have a significant impact on the housing market, from zoning regulations to Trump's immigration policies.

  • Why this matters: Policy changes can affect everything from the supply of new homes to the availability of construction workers.
  • My take: It’s important to stay informed about these potential changes and how they could impact your local market. This is not something you can control, but you should be aware of them.

10. New Construction is Giving the Housing Supply a Much Needed Boost

With existing home sales constrained, new home construction is playing a bigger role in meeting demand.

  • Why this matters: More new homes help ease the housing shortage and provide more options for buyers.
  • My take: This is a promising trend, but it’s important to remember that new construction can also come with its own set of challenges, such as higher prices and potential construction delays.

To Sum It All Up

Here’s a quick recap of the 10 must-know trends in the current housing market.

Trend Prediction Impact
Mortgage Rates Stabilizing around 6.5% – 7% More predictable planning for buyers and sellers
Home Prices Moderately rising (3% – 4% annually) Continued affordability challenges
Affordability Remains a significant challenge Makes homeownership difficult, especially for first-time buyers
Inventory Limited, but new construction is increasing Keeps prices elevated; new construction offers some relief
Market Crash No major crash expected Stability for market participants
Buyer Caution Many waiting for lower rates Suppressed demand, affecting sales volumes
Seller Activity Gradually increasing, but still below pre-pandemic levels Could ease inventory constraints, but slowly
Regional Variations Trends differ by region Requires understanding local market dynamics
Policy Changes Could significantly impact housing Requires close monitoring for market implications
Rise in New Construction Helping address housing shortage Offers new housing options and alleviates demand on existing homes

The housing market in 2025 is complex, and there’s no one-size-fits-all answer. It’s all about understanding these trends, doing your research, and making informed decisions that are right for you and your family. Remember to consult with real estate professionals, financial advisors, and other experts to get personalized guidance.

Stay Ahead of 2025 Housing & Mortgage Trends with Norada

The 10 Housing Market & Mortgage Trends of 2025 will shape real estate—secure your future with turnkey rental properties that offer steady returns.

Whether rates rise or fall, investing in high-quality, cash-flowing properties is a proven way to build wealth.

Speak with our expert investment counselors (No Obligation):

(800) 611-3060

Get Started Now

Mortgage Rate Predictions This Week: February 24 – March 2, 2025

by

Worried about where mortgage rates are headed this week? You're not alone! Based on current trends and expert analysis, mortgage rate predictions this week, February 24th to March 2nd, 2025, indicate rates will likely hold steady, hovering between 6.5% and 7%. While this isn't the rock-bottom rates we saw a few years ago, it's crucial to understand why rates are where they are and what you can do as a potential homebuyer or homeowner. Let's dive in.

Mortgage Rate Predictions This Week: February 24 – March 2, 2025

The mortgage world has been quite complex for buyers. It's influenced by everything from inflation to the Federal Reserve's policies. Right now, we're seeing a slight easing in mortgage rates, which is good news. However, affordability is still a major concern for many.

To get a good handle on where things stand, let's look at some recent data. According to Freddie Mac’s Primary Mortgage Market Survey from February 20, 2025, here’s the snapshot:

  • 30-Year Fixed Rate Mortgage (FRM): 6.85%
    • 1-Week Change: -0.02%
    • 1-Year Change: -0.05%
    • 4-Week Average: 6.89%
    • 52-Week Average: 6.76%
    • 52-Week Range: 6.08% – 7.22%
  • 15-Year Fixed Rate Mortgage (FRM): 6.04%
    • 1-Week Change: -0.05%
    • 1-Year Change: -0.25%
    • 4-Week Average: 6.08%
    • 52-Week Average: 5.99%
    • 52-Week Range: 5.15% – 6.47%

These numbers tell a story: rates have come down slightly recently, but they're still significantly higher than what many consider affordable.

What's Driving Mortgage Rate Trends?

Several factors are playing a big role in shaping where mortgage rates are going:

  1. Inflationary Pressures: Remember when prices were skyrocketing for everything? Well, inflation is still higher than the Federal Reserve would like. The Fed is targeting 2% inflation, but we're currently around 3%. This makes it less likely that the Fed will cut interest rates anytime soon.
  2. Federal Reserve Policy Outlook: The Fed uses interest rates to control inflation and keep the economy humming. Because inflation remains a concern, most experts believe the Fed will keep interest rates where they are for a while. They're waiting for more convincing signs that inflation is truly under control. Any potential rate cuts largely hinges on the economic cooling, which isn't expected in the immediate future.
  3. Increasing Housing Inventory: Here's some good news! More homeowners are deciding to sell, which means there are more houses on the market. This increased inventory could help to stabilize, or even lower, housing prices. More options for buyers is generally a positive sign.
  4. Bond Market Behavior: Mortgage rates are closely tied to the 10-year Treasury note. This is essentially a bond issued by the government. If the economy looks strong, and inflation is still high, bond yields (and mortgage rates) tend to rise. If inflation shows signs of cooling down, rates might decrease.

In my experience, patience is key in times like these. We are in a period where the market is adjusting. It is certainly not the time to panic. Home buying and selling decisions must be well thought out and not in reaction to media headlines. I am advising my clients to focus on the long-term value, negotiate wisely, and be prepared to hold their properties through these fluctuating times.

Looking Ahead: Predictions for the Week of February 24 – March 2, 2025

Based on everything I'm seeing, I predict that mortgage rates will likely remain within the 6.5% to 7% range this week. It’s hard to see any major movement in either direction.

While this may be higher than some people would like, it's worth remembering that these rates are closer to the historical average for 30-year fixed mortgages. The super-low rates we saw during the pandemic were an anomaly, not the norm.

Important Considerations:

It's really important to recognize that predictions are just that – predictions. Market conditions can change quickly. Factors like unexpected economic news or shifts in investor sentiment can all influence mortgage rates.

Strategic Tips for Homebuyers

If you're thinking about buying a home, or already in the process, here's my advice:

  • Do a thorough financial assessment. Before you even start looking at houses, figure out exactly how much you can afford. Consider not just the mortgage payment, but also property taxes, insurance, and potential maintenance costs. Make sure this budget aligns with your financial goals.
  • Work on your credit score. A higher credit score can mean a lower interest rate on your mortgage. Check your credit report for any errors and take steps to improve your score if needed.
  • Save for a larger down payment. Putting more money down upfront can reduce your monthly payments and potentially eliminate the need for private mortgage insurance (PMI). It also shows lenders that you're a serious buyer.
  • Shop around for the best rate. Don't just go with the first lender you talk to. Get quotes from multiple lenders to see who can offer you the best deal. This can save you a significant amount of money over the life of the loan.
  • Think long-term. Buying a home is a big decision. Consider whether it aligns with your long-term financial goals and lifestyle preferences. Is it the right time for you, or would renting be a better option for now?

Rent vs. Buy: Is it the Right Time?

This is a question I get asked a lot! The answer really depends on your personal circumstances. Here's a simple table that illustrates some of the key differences:

Feature Renting Buying
Initial Cost Lower (security deposit, first month's rent) Higher (down payment, closing costs)
Monthly Costs Rent, utilities Mortgage, property taxes, insurance, HOA fees, maintenance
Equity None Builds over time
Flexibility More Less
Tax Benefits Few Potential deductions for mortgage interest and property taxes
Customization Limited More freedom to personalize
Appreciation None (landlord benefits) Possible appreciation in property value

My Perspective

Mortgage rate predictions this week suggest a continuation of the current trends. While it's tempting to wait for rates to drop significantly, remember that this is just one factor to consider.

Having navigated several housing market cycles, I've learned that timing the market perfectly is nearly impossible. Instead, I advise clients to focus on their individual financial situations, long-term goals, and to make informed decisions based on their risk tolerance. It's better to enter the market when you're financially prepared, rather than trying to predict its next move.

By carefully assessing your financial situation, shopping around for the best deal, and focusing on your long-term goals, you can make a smart decision, whether you're buying your first home or refinancing an existing mortgage.

Work with Norada in 2025, Your Trusted Source for

Real Estate Investing

With mortgage rates fluctuating, investing in turnkey real estate

can help you secure consistent returns.

Expand your portfolio confidently, even in a shifting interest rate environment.

Speak with our expert investment counselors (No Obligation):

(800) 611-3060

Get Started Now

Will Mortgage Rates Go Down in 2026: Predictions Say “Yes”

by

Trying to figure out where mortgage rates are headed is like trying to predict the weather – there are a lot of factors at play! If you're wondering will mortgage rates go down in 2026?, the answer is likely yes, but it's not a done deal. Based on current economic forecasts, rates could drop to somewhere between 6.17% to 6.67%, which is a bit lower than the 6.94% we're seeing in early 2025. This potential decrease hinges on things like the Federal Reserve cutting rates and lower Treasury yields. But hold on – there's more to the story.

Will Mortgage Rates Go Down in 2026?

Current Mortgage Rate Situation

Let's take a snapshot of where we stand right now. As of February 24, 2025, the average 30-year fixed mortgage rate is sitting around 6.94%, according to Bankrate. This number is heavily influenced by the 10-year Treasury yield, which is hovering around 4.27% (you can check that out on FRED).

Think of it like this: the 10-year Treasury yield is like the base price, and then lenders add a bit extra – what they call a “spread” – to cover their costs and risks. Currently, that spread is about 2.67%, as Fannie Mae explains, accounting for things like the risk that people might pay off their mortgages early or that they might default.

Why We Might See Lower Mortgage Rates in 2026

So, what makes economists think rates could go down? Here's the breakdown:

  • The Fed's Expected Moves: The Federal Reserve (the Fed) is like the conductor of the economy's orchestra. Right now, the expectation is that they will be cutting interest rates in the near future. Most forecasts, including those from CCN, suggest the federal funds rate will be around 3% by the end of 2025 and 2.9% by the end of 2026.
  • Lower Treasury Yields: The 10-year Treasury yield is expected to drop as well. Bankrate predicts it could be around 4.14% by December 2025, and some forecasts, like those from Statista, even suggest it could hit 3.39% by January 2025, with further declines possible in 2026.

Basically, if the Fed cuts rates and Treasury yields fall, mortgage rates should follow suit.

How Low Could Mortgage Rates Go in 2026?

If we assume that the spread between the 10-year Treasury yield and mortgage rates stays around 2.67% (which, admittedly, is a big “if”), we can make some educated guesses:

  • If the 10-year Treasury yield drops to 3.5%, mortgage rates could be around 6.17% (3.5% + 2.67% = 6.17%).
  • If the 10-year Treasury yield drops to 4.0%, mortgage rates could be around 6.67% (4.0% + 2.67% = 6.67%).

The Spread: A Wildcard

Now, here's where things get tricky. That 2.67% spread isn't set in stone. As the Richmond Fed points out, it tends to increase during times of economic stress. On the other hand, Brookings suggests that recent widening has been due to specific Fed actions. If the economy stabilizes, that spread could narrow, leading to even lower mortgage rates. But if uncertainty creeps in, it could widen, meaning rates might not fall as much as predicted.

The Trump Factor: Throwing a Wrench in the Gears?

This is where it gets really interesting. The potential return of a Trump administration adds a whole new layer of complexity to the equation. Trump's proposed economic policies – things like tax cuts, deregulation, and tariffs – could have a significant impact on inflation and, in turn, on interest rates.

  • The Good: Some argue that tax cuts and deregulation could boost economic growth, as Invesco US points out.
  • The Bad: However, tariffs and immigration restrictions could raise prices, as CBS News reports, leading to higher inflation. As Project Syndicate notes, higher inflation could force the Fed to rethink its plans for cutting rates.

This uncertainty is reflected in some market forecasts, with Reuters reporting that some analysts believe the 10-year yield could even climb to 5% if Trump's policies lead to higher inflation.

Global Economics: We're All Connected

We can't forget about what's happening in the rest of the world. Trade tensions, geopolitical events, and the overall health of the global economy can all influence U.S. interest rates. McKinsey highlights trade policy changes as a major concern for 2025, which could definitely affect Treasury yields.

Putting It All Together: The 2026 Mortgage Rate Outlook

Okay, let's try to make sense of all this. Here's a table summarizing different scenarios for 2026 mortgage rates, based on varying 10-year Treasury yields (assuming that constant 2.67% spread):

Scenario 10-Year Treasury Yield (2026) Expected Mortgage Rate (2026) Change from Current (6.94%)
Base Case 3.5% 6.17% -0.77%
Higher Yield Scenario 4.0% 6.67% -0.27%
Lower Yield Scenario 3.0% 5.67% -1.27%

Important Note: These are just estimates! Real-world mortgage rates will depend on a whole host of economic conditions and policy changes that are impossible to predict with certainty.

My Take on the Situation

As someone who's been watching the housing market for years, I can tell you that predicting mortgage rates is always a bit of a guessing game. While the current forecasts suggest a likely decrease in rates by 2026, the influence of factors like the potential Trump administration and global economic conditions makes it difficult to say for sure. It's a complex situation, and the exact extent of any decrease remains uncertain.

Personally, I think it's wise to be cautiously optimistic. The Fed seems determined to bring inflation under control, which should lead to lower rates eventually. However, potential policy changes could throw a wrench in the works.

What Should Homebuyers Do?

If you're thinking about buying a home, here's my advice:

  • Stay informed: Keep an eye on economic news and forecasts. Pay attention to what the Fed is saying and doing, and be aware of potential policy changes that could affect the economy.
  • Shop around: Don't just go with the first mortgage lender you find. Get quotes from multiple lenders to make sure you're getting the best possible rate.
  • Consider your personal circumstances: Can you afford a home at current rates? How long do you plan to stay in the home? These are important questions to ask yourself.
  • Don't try to time the market: Trying to perfectly time the market is a fool's errand. Focus on finding a home you love and can afford.

The Bottom Line

Based on current research, mortgage rates are likely to decrease in 2026. We could see rates somewhere between 5.67% and 6.67%, which would be a welcome change from the 6.94% we're seeing now. This decrease is likely to be driven by Fed rate cuts and lower Treasury yields. However, the potential impact of Trump's policies adds uncertainty to the outlook.

In conclusion, while a decrease seems probable, the extent remains uncertain, and homebuyers should monitor economic developments closely.

Work with Norada, Your Trusted Source for

Real Estate Investing

With mortgage rates fluctuating, investing in turnkey real estate

can help you secure consistent returns.

Expand your portfolio confidently, even in a shifting interest rate environment.

Speak with our expert investment counselors (No Obligation):

(800) 611-3060

Get Started Now 

Home Price and Sales Forecast February 2025: Zillow’s Predictions

by

If you're wondering what's in store for the housing market, the Home Value and Home Sales Forecast suggests a mixed bag for 2025. Expect a modest increase in home values (less than 1%), coupled with a slight uptick in home sales. Basically, don't expect a boom, but also don't brace for a bust. Let's dive into what's driving these predictions.

I've been following the real estate market closely for years, and while forecasts are just that – forecasts – they offer valuable insights into potential trends. Understanding these trends can help both buyers and sellers make informed decisions.

Home Value and Home Sales Forecast: What to Expect in 2025

Why the Modest Growth?

Several factors are contributing to this cautious outlook.

  • Mortgage Rates: Mortgage rates are the biggest factor. Even if they dip slightly by the end of 2025, they're likely to stay high enough to keep many potential buyers on the sidelines.
  • Inventory: The number of homes on the market is higher than previously anticipated. This increased inventory puts downward pressure on prices. This means buyers have more choices, and sellers may need to adjust their expectations.
  • Economic Uncertainty: Overall economic uncertainty always plays a role. People are hesitant to make big financial decisions like buying a home when the future feels unclear.

Zillow's Predictions in Detail

Zillow's latest report gives us some specific numbers to work with:

  • Home Value Growth: Zillow forecasts a mere 0.9% increase in home values for 2025. This is a significant downgrade from their previous projection of 2.9%.
  • Existing Home Sales: They project 4.11 million existing home sales in 2025. This is essentially flat compared to 2023 and 2024 and remains well below pre-pandemic levels (5.3 million in 2019).
  • Rent Increases: With many potential buyers staying put, rental demand is expected to rise. Zillow predicts a 3.7% increase in single-family rents and a 3.1% increase in multifamily rents.

What Does This Mean for You?

If you're thinking about buying or selling, here's how these forecasts could affect you:

  • For Buyers: Don't expect a huge drop in prices, but you might have a bit more negotiating power due to increased inventory. Shop around for the best mortgage rates, and be prepared to act quickly if you find the right property.
  • For Sellers: Don't overprice your home! The market isn't as hot as it was a few years ago. Work with a real estate agent to price your home competitively and highlight its best features.

Regional Differences: Where the Action Is (and Isn't)

It's crucial to remember that real estate is local. National forecasts only paint a broad picture. Some markets will perform better than others. Zillow highlights the areas they expect to see the strongest and weakest home price appreciation:

Top 10 Markets for Home Price Appreciation (January 2025 – January 2026):

  • Knoxville, TN: 5.2%
  • Atlantic City, NJ: 5.1%
  • Torrington, CT: 4.8%
  • Bangor, ME: 4.8%
  • Kingston, NY: 4.7%
  • Pottsville, PA: 4.7%
  • Syracuse, NY: 4.5%
  • Rochester, NY: 4.4%
  • Norwich, CT: 4.4%
  • Vineland, NJ: 4.3%

Bottom 10 Markets for Home Price Appreciation (January 2025 – January 2026):

  • Lake Charles, LA: -7.3%
  • Houma, LA: -6.4%
  • New Orleans, LA: -5.1%
  • Lafayette, LA: -4.1%
  • Shreveport, LA: -3.9%
  • Odessa, TX: -3.8%
  • Beaumont, TX: -3.6%
  • Chico, CA: -3.1%
  • Midland, TX: -2.8%
  • Alexandria, LA: -2.5%

Notice a pattern? The markets expected to do well are often more affordable, smaller cities. The struggling markets are concentrated in specific regions facing unique economic challenges.

A Word of Caution: Florida's Inventory Surge

While Zillow is generally optimistic about Florida's housing market, some analysts are more cautious. Florida has seen a significant increase in active inventory and months of supply. This suggests that prices could face downward pressure, and some data already shows single-family and condo prices declining in many Florida markets. Keep a close eye on local data if you're buying or selling in Florida.

My Take: It's All About the Long Game

Based on the forecasts and my own experience, here's my personal view on the 2025 housing market:

  • Don't Expect a Repeat of the Pandemic Boom: Those days are gone. We're entering a period of more moderate growth.
  • Focus on Your Personal Needs: Don't make a real estate decision based solely on market forecasts. Consider your financial situation, your lifestyle, and your long-term goals.
  • Real Estate is Still a Solid Investment: Historically, real estate has been a good long-term investment. Even if prices don't skyrocket in 2025, owning a home can still provide stability and build wealth over time.

Beyond the Numbers: Factors to Watch

Besides mortgage rates and inventory, several other factors could influence the housing market in 2025:

  • The Economy: A strong economy can boost consumer confidence and increase demand for housing. Conversely, a recession could dampen the market.
  • Inflation: High inflation can erode purchasing power and make it harder for people to afford homes.
  • Government Policies: Changes in tax laws or housing regulations can significantly impact the market.
  • Demographic Trends: Shifts in population and household formation can influence housing demand. For example, the aging population is creating demand for senior housing, while millennials are entering their prime homebuying years.
  • Construction Costs: Supply chain issues and labor shortages have driven up construction costs, making it more expensive to build new homes. This can limit supply and put upward pressure on prices.

The Bottom Line

The Home Value and Home Sales Forecast suggests a relatively stable housing market in 2025. While home values and sales are expected to increase slightly, don't anticipate a dramatic surge. By staying informed, working with professionals, and focusing on your personal needs, you can navigate the market successfully, whether you're buying, selling, or simply trying to understand the latest trends.

Ultimately, the housing market is complex and dynamic. There are no guarantees, and forecasts are always subject to change. However, by understanding the key factors influencing the market, you can make informed decisions and achieve your real estate goals.

Work with Norada in 2025, Your Trusted Source for Investment

in the Top Housing Markets of the U.S.

Discover high-quality, ready-to-rent properties designed to deliver consistent returns.

Contact us today to expand your real estate portfolio with confidence.

Contact our investment counselors (No Obligation):

(800) 611-3060

Get Started Now 

Today’s Mortgage Rates February 24, 2025: Rates Dip Slightly

by

Feeling that homeownership dream getting closer? As of February 24, 2025, mortgage rates are offering a glimmer of hope for homebuyers and those eyeing a refinance. The national average for a 30-year fixed mortgage rate currently sits at 6.50%, a welcome dip. Meanwhile, the 15-year fixed mortgage rate is holding steady at 5.83%. The good news? Experts anticipate a fairly stable market throughout 2025, so don't expect wild swings in either direction.

Today’s Mortgage Rates February 24, 2025: Rates Dip Slightly

Why Mortgage Rates Matter (And Why You Should Care)

Okay, rates are what they are, but why should you pay attention? Well, mortgage rates directly impact how much you'll pay each month, and over the life of your loan. Even a small change can add up to big savings (or big costs!). It’s simple: if rates are lower, you will pay a lower amount monthly.

I’ve been following the mortgage market for quite some time, and I can tell you, navigating these numbers can feel like trying to decipher a secret code. But understanding these rates is crucial for making smart financial decisions, whether you're buying your first home, moving up to a bigger space, or just trying to save money through refinancing.

Diving Deep: Current Mortgage Rates Today

Let's break down the current rate scene. Here's a snapshot of today's mortgage rates by Zillow, giving you a clear view of where things stand:

Mortgage Type Current Rate
30-Year Fixed 6.50%
20-Year Fixed 6.25%
15-Year Fixed 5.83%
5/1 ARM 6.50%
7/1 ARM 6.45%
30-Year VA 5.98%
15-Year VA 5.48%
5/1 VA 6.06%

What's the takeaway? The 30-year fixed rate, as always, remains the most popular choice. Veteran homebuyers will likely want to explore the VA loans. But which one is right for you depends on your individual circumstances.

Refinancing: Is It Time To Make a Move?

Are you already a homeowner? Then refinancing might be on your radar. The goal is simple: to get a better interest rate, lower your monthly payments, or shorten your loan term. Here’s what you should consider:

Refinance Type Current Rate
30-Year Fixed 6.53%
20-Year Fixed 6.25%
15-Year Fixed 5.88%
5/1 ARM 6.56%
7/1 ARM 6.36%
30-Year VA 5.98%
15-Year VA 5.56%
5/1 VA 6.08%
30-Year FHA 6.09%
15-Year FHA 5.55%

Notice that refinance rates are typically slightly higher than purchase rates. That's a normal pattern. Before you jump into refinancing, take a hard look at your current mortgage. Is your existing rate lower than what's available today? If so, refinancing probably isn't the right move right now. Also remember to factor in closing costs when assessing the true cost of refinancing! It eats up a lot of your savings.

The Numbers Game: Monthly Payments and Your Budget

Okay, enough with the percentages. Let's get down to the nitty-gritty: how much will you actually pay each month? Here’s a breakdown based on the current 30-year fixed rate of 6.50%:

  • $150,000 Mortgage: About $948 per month (principal and interest).
  • $200,000 Mortgage: Around $1,264 per month (principal and interest).
  • $300,000 Mortgage: Approximately $1,896 per month (principal and interest).
  • $400,000 Mortgage: Close to $2,528 per month (principal and interest).
  • $500,000 Mortgage: In the neighborhood of $3,170 per month (principal and interest).

Important caveat: These numbers only include principal and interest. You'll also need to factor in property taxes, homeowners insurance, and potentially private mortgage insurance (PMI) if you're putting less than 20% down. Those extra costs can really add up.

As someone who has helped many people buy homes, I always advise them to get pre-approved for a mortgage. This will allow you to see how much you can afford, and you can begin to estimate monthly payments.

Fixed vs. Adjustable: Choosing the Right Mortgage

You've probably heard about fixed-rate and adjustable-rate mortgages (ARMs), but what's the real difference?

  • Fixed-Rate Mortgages: The interest rate stays the same for the entire life of the loan. This means predictable monthly payments, which is great for budgeting and peace of mind. The 30-year fixed is the most common choice, but 15-year and 20-year options are also available.
  • Adjustable-Rate Mortgages (ARMs): The interest rate can change periodically, usually once a year. ARMs often start with a lower initial interest rate than fixed-rate mortgages, which can be attractive. However, your payments could increase significantly if rates rise. It's like riding a rollercoaster.

So, which one is right for you? If you value stability and predictability, a fixed-rate mortgage is probably the way to go. If you're comfortable with some risk and believe that rates will stay low or even decline, an ARM could save you money – at least in the short term.

VA, FHA, and Conventional Loans: Understanding Your Options

The mortgage world is full of acronyms, but understanding the different types of loans can open doors.

  • Conventional Loans: These are mortgages that aren't backed by the government. They typically require a down payment of at least 5% (although some programs offer lower options) and good credit. If you put less than 20% down, you'll usually have to pay private mortgage insurance (PMI).
  • FHA Loans: Insured by the Federal Housing Administration (FHA), these loans are popular among first-time homebuyers and those with less-than-perfect credit. FHA loans require a smaller down payment (as low as 3.5%) but come with mortgage insurance premiums (MIP) that you'll pay for the life of the loan.
  • VA Loans: Guaranteed by the Department of Veterans Affairs (VA), these loans are available to eligible veterans, active-duty service members, and surviving spouses. VA loans don't require a down payment or private mortgage insurance, making them an incredibly attractive option.
  • USDA Loans: Backed by the United States Department of Agriculture, these loans help moderate to low income homebuyers purchase homes in rural areas.

Each loan has its own rules, requirements, and advantages. The best loan for you depends on your credit score, down payment, income, and overall financial situation.

Market Trends and What They Mean for You

Now, let's talk about where the mortgage market is headed. As mentioned earlier, experts anticipate a fairly stable environment throughout 2025. That means we probably won't see any massive rate drops in the near future.

What does this mean for you? If you're thinking about buying a home, now might be a good time to lock in a rate, especially if you find one that's below the current average. If you're considering refinancing, carefully weigh the costs and benefits before making a decision. Also, make sure you shop around, comparing lenders and finding the one that works best for you.

Taking Control: Tips for Getting the Best Mortgage Rate

While you can't control the overall direction of mortgage rates, you can take steps to improve your chances of getting a good deal:

  • Improve Your Credit Score: A higher credit score translates to a lower interest rate. Pay your bills on time, keep your credit card balances low, and avoid opening too many new accounts at once.
  • Save for a Larger Down Payment: The more money you put down, the less you'll need to borrow – and the lower your interest rate is likely to be.
  • Shop Around for the Best Rate: Don't just settle for the first offer you receive. Get quotes from multiple lenders, and compare their rates, fees, and terms.
  • Consider Working with a Mortgage Broker: A mortgage broker can help you find the best loan for your needs, and negotiate on your behalf.

Final Thoughts: Navigating the Mortgage Maze

The mortgage market can feel complicated, but with a little knowledge and preparation, you can navigate it successfully. By understanding current rates, exploring your loan options, and taking steps to improve your financial standing, you can achieve your homeownership goals.

Don't be afraid to ask questions, seek advice from experts, and take your time to make the right decision. Buying a home is a big step, but it's one that can bring immense joy and financial security.

Work with Norada in 2025, Your Trusted Source for

Real Estate Investing

With mortgage rates fluctuating, investing in turnkey real estate

can help you secure consistent returns.

Expand your portfolio confidently, even in a shifting interest rate environment.

Speak with our expert investment counselors (No Obligation):

(800) 611-3060

Get Started Now

Average Home Price in Los Angeles Reaches $953K

by

So, you're wondering about the average home price in Los Angeles in January 2025? Well, based on current trends, while predictions are always subject to change, the crystal ball suggests you're likely looking at around $953,514. That's the figure we're projecting based on existing data, but let's dive deep into why, and what that number really means for you as a potential buyer or seller in the City of Angels.

The Los Angeles real estate market is a beast of its own. It's influenced by a complex mix of factors, from interest rates and the overall economy to local job growth and even celebrity real estate deals. So, let's unpack what's driving those price tags and what you can expect as we head into 2025.

Average Home Price in Los Angeles – Jan 2025: What to Expect

What's Driving Home Prices in LA?

Several key factors are constantly pushing and pulling on LA home prices. Here's a breakdown of the big ones:

  • Interest Rates: This is a biggie. Higher interest rates mean higher mortgage payments, which can cool down demand and potentially put downward pressure on prices. Conversely, lower rates can fuel bidding wars and drive prices up. The Federal Reserve's decisions will play a crucial role.
  • The Economy: A strong economy generally means more jobs, higher incomes, and more people looking to buy homes. A recession, on the other hand, can lead to job losses and uncertainty, causing people to hold off on major purchases like real estate.
  • Supply and Demand: This is the classic economic principle. Los Angeles has historically suffered from a lack of housing supply, which has contributed to rising prices. If more homes are built, it could ease some of the pressure.
  • Location, Location, Location: This isn't just a saying; it's a reality. Some neighborhoods in LA are consistently more desirable (think Beverly Hills, Santa Monica, or Los Feliz), and homes in those areas command a premium.
  • The “California Dream:” Despite the high cost of living, many people still dream of living in California, particularly in vibrant cities like Los Angeles. This constant influx of people helps to keep the demand high.

Looking Back: How Did We Get Here?

To understand where we're going, it helps to look where we've been. According to Zillow, the average Los Angeles, CA home value is $953,514, up 1.4% over the past year. This data point alone is a powerful insight.

What Does $953,514 Really Buy You in LA?

Alright, let's be real. Nearly a million dollars doesn't stretch as far as you might think in Los Angeles. Here's a glimpse of what that kind of budget could get you:

  • A Condo in a Desirable Area: You could potentially snag a well-located condo in neighborhoods like West Hollywood, Downtown LA, or even parts of Santa Monica, depending on size and condition.
  • A Small House in a Less “Trendy” Neighborhood: In areas further from the coast or in less-established neighborhoods, you might find a smaller single-family home, potentially needing some updating.
  • A Fixer-Upper with Potential: If you're willing to put in the work (and the money) to renovate, you could find a property with good bones in a desirable location that needs some TLC.
  • A Down Payment on Something Larger: Of course, this figure could also represent a significant down payment on a more expensive property in a top-tier neighborhood.

Days on Market: A Sign of the Times

The statistic that homes go to pending in around 36 days is also important. That suggests the market isn't as red-hot as it was a few years ago, when homes were flying off the shelves in a matter of days. 36 days is still a relatively quick turnaround, indicating there's still solid demand, but buyers might have a little more breathing room to make decisions.

My Personal Take: A Word of Caution and Optimism

Look, I've seen the LA real estate market go through its ups and downs. It's tempting to try and time the market perfectly, but honestly, that's incredibly difficult. Here's my advice, take it with a pinch of salt:

  • Don't Panic: Whether you're buying or selling, don't let fear or FOMO (fear of missing out) drive your decisions. Do your research, get expert advice, and make a rational choice that aligns with your financial goals.
  • Think Long-Term: Real estate is generally a long-term investment. If you're planning to live in the property for several years, short-term market fluctuations shouldn't be your primary concern.
  • Be Realistic About Your Budget: Don't overextend yourself. Factor in all the costs of homeownership, including property taxes, insurance, maintenance, and potential repairs.
  • Consider Alternative Neighborhoods: Los Angeles is a vast city with many diverse neighborhoods. Explore different areas to find one that fits your budget and lifestyle. You might be surprised at what you discover.
  • Get Professional Help: A good real estate agent can be an invaluable resource. They can provide local market expertise, negotiate on your behalf, and guide you through the complex process of buying or selling a home.

Factors That Could Shift the Prediction

While our projected average of $953,514 seems reasonable, remember that unforeseen events can always impact the market. Here are a few “wild card” scenarios:

  • A Major Economic Recession: A significant downturn could lead to job losses and a drop in demand for housing.
  • A Sudden Increase in Interest Rates: An unexpected hike in interest rates could cool the market quickly.
  • A Large Influx of New Construction: If developers suddenly build a large number of new homes, it could increase the supply and put downward pressure on prices.
  • Changes to Housing Policies: Government policies related to zoning, rent control, or mortgage lending could impact the market.

Beyond the Average: What Truly Matters?

Focusing solely on the average home price can be misleading. Remember, that number represents a wide range of properties and neighborhoods. What truly matters is finding a home that fits your individual needs, budget, and lifestyle.

Here are some things to consider:

  • Your Personal Priorities: What's most important to you? Location, size, amenities, school district, commute time?
  • Your Financial Situation: How much can you realistically afford? Get pre-approved for a mortgage to know your borrowing power.
  • Your Long-Term Goals: How long do you plan to live in the property? What are your future financial plans?

Summary:

The Los Angeles real estate market is complex and competitive, but it's also full of opportunity. By understanding the factors that influence home prices, doing your research, and seeking professional guidance, you can make informed decisions and achieve your real estate goals. While the average home price in Los Angeles in January 2025 is projected to be around $953,514, remember that's just one piece of the puzzle. Focus on what's important to you, and you'll be well on your way to finding your dream home in the City of Angels.

Average Home Price in San Jose Reaches $1.45 Million

by

The average home price in San Jose as of January 2025 stands at $1,453,657. This reflects an 8.3% increase compared to the previous year, indicating a still-hot housing market despite broader economic shifts. Homes are going under pending sale in around 15 days.

San Jose, California, has always been a unique beast in the real estate world. It's the heart of Silicon Valley, where tech giants and ambitious startups fuel a high demand for housing. As someone who's been following the market for years, I've seen booms and busts, but San Jose always seems to bounce back. So, what's driving these numbers, and what does it mean for you, whether you're a buyer, seller, or just curious? Let's dive in.

Average Home Price in San Jose – Jan 2025: What You Need to Know

Understanding the San Jose Housing Market: Key Factors at Play

The San Jose housing market isn't just about square footage and curb appeal. Several interwoven factors create the landscape we see today:

  • Tech Industry Dominance: This is the elephant in the room. The concentration of high-paying tech jobs continues to drive demand. When companies like Google, Apple, and Facebook expand their presence, it creates a ripple effect throughout the housing market.
  • Limited Housing Supply: San Jose, like much of the Bay Area, suffers from a chronic shortage of housing. Strict zoning laws, slow permitting processes, and geographical constraints (mountains on one side, the Bay on the other) limit new construction. This scarcity drives up prices.
  • Interest Rates: While interest rates have fluctuated, they remain a significant factor in affordability. Higher rates make it more expensive to borrow money for a mortgage, potentially cooling down demand. However, San Jose's high-income earners are somewhat insulated from interest rate hikes compared to other markets.
  • Investor Activity: San Jose remains an attractive market for real estate investors, both domestic and international. They compete with traditional homebuyers, further contributing to price increases.
  • Overall Economic Conditions: While the tech industry is a major driver, the broader economic climate impacts consumer confidence and spending. If there's a recession or major economic downturn, it could put downward pressure on housing prices.

Breaking Down the Numbers: What Do They Really Mean?

Let's take a closer look at the key metrics from Zillow's January 2025 report:

  • Typical Home Value: $1,453,657
    • This is the median price of all homes in San Jose, giving you a general sense of the market.
  • 1-Year Value Change: +8.3%
    • This shows how much home values have appreciated (or depreciated) over the past year. An 8.3% increase is significant and indicates continued strong demand.
  • For Sale Inventory: 724
    • This is the number of homes currently listed for sale. A low inventory suggests a seller's market, where there are more buyers than homes available.
  • New Listings: 309
    • This is the number of new homes that came on the market in January. Comparing this to the for-sale inventory can give you an idea of how quickly homes are being sold.
  • Median Sale to List Ratio: 1.019 (December 2024)
    • This ratio indicates the median price that the houses are being sold at relative to their listing price. For example, a ratio of 1.019 indicates that houses are being sold at 1.9% over their listing price.
  • Median Sale Price: $1,387,583 (December 2024)
    • This is the price at which half of the homes sold for more, and half sold for less. It's a good indicator of the actual selling price.
  • Median List Price: $1,146,088 (January 2025)
    • This is the median price at which homes are listed on the market.
  • Percent of Sales Over List Price: 65.0% (December 2024)
    • This is the percentage of homes that sold for more than their asking price. A high percentage suggests strong buyer competition.
  • Percent of Sales Under List Price: 29.0% (December 2024)
    • This is the percentage of homes that sold for less than their asking price.
  • Median Days to Pending: 15
    • This is how long it takes, on average, for a home to go under contract (pending sale). 15 days is very fast, indicating a hot market.

San Jose Neighborhood Hotspots: Where's the Action?

Not all San Jose neighborhoods are created equal. Some areas are more desirable and experience faster price appreciation than others. Here's a snapshot of the Median ZHVI (Zillow Home Value Index) for a few neighborhoods as of January 2025:

Neighborhood Median ZHVI
Fairgrounds $992,253
Downtown $1,042,070
Seven Trees $1,072,643
Sunol-Midtown $1,161,013
East San Jose $1,070,427
Willow Glen $1,803,490
Buena Vista $890,186
Edenvale – Seven Trees $1,130,802
Burbank $1,198,116

As you can see, there's a wide range of home values across different neighborhoods. Willow Glen commands a premium due to its charming downtown, excellent schools, and tree-lined streets. Fairgrounds and Buena Vista offer more affordable options.

The Rental Market: A Pressure Release Valve?

If buying in San Jose feels out of reach, you're not alone. The rental market provides an alternative, but it's also competitive. According to Zillow, the average rent in San Jose as of January 2025 is $3,095, significantly higher than the national average of $1,968. The rent grew 0.3% month-over-month and 3.8% year-over-year.

While still expensive, renting can offer flexibility and allow you to save for a down payment. It's also worth noting that rental prices can fluctuate based on the time of year and the availability of units.

Looking Ahead: What Does the Future Hold?

Predicting the future of the San Jose housing market is always a challenge. However, here are a few potential scenarios:

  • Continued Growth: If the tech industry continues to thrive and the housing supply remains limited, prices could continue to rise, albeit perhaps at a slower pace.
  • Market Correction: A significant economic downturn or a rise in interest rates could trigger a market correction, leading to price declines.
  • Stabilization: The market could stabilize, with prices remaining relatively flat for a period of time.

Ultimately, the future depends on a complex interplay of economic, demographic, and political factors. As someone who's invested in this area, I will definitely keep an eye on these trends.

Mortgage Rates Drop to 2-Month Low Boosting Housing Affordability

by

Are you dreaming of owning a home? Good news! Mortgage rates have recently dipped to their lowest point in two months, offering a welcome boost to your purchasing power. This means that with the same budget, you can now afford a slightly more expensive home than you could just a few weeks ago. This is a great opportunity to jump back into the market if you've been waiting on the sidelines.

Think of it like this: a small drop in mortgage rates can have a domino effect, making homeownership a little bit more attainable. As someone who's been following the housing market closely for years, I know how frustrating it can be to watch rates climb and your dream home slip further out of reach. That's why this recent dip is significant, and I want to help you understand what it means for you.

Mortgage Rates Drop to 2-Month Low Boosting Housing Affordability

Key Takeaways

  • Mortgage rates have dropped to their lowest level in two months.
  • This drop increases your purchasing power, allowing you to afford a slightly more expensive home.
  • Economic uncertainty is a key factor driving the rate decline.
  • Housing costs are still high, and negotiating power varies by location.
  • It's essential to assess your financial situation and work with qualified professionals before making a purchase.

According to a recent Redfin report, the daily average mortgage rate on February 21, 2025, hovered around 6.9%, the lowest rate since mid-December. This is welcome news after what feels like a long period of high rates.

It's important to understand what's behind these fluctuations. One factor, according to the Redfin report, is the worry that certain Trump administration policies—like tighter immigration controls, tariffs, and federal government job cuts—could slow down economic growth. When the economy is expected to slow, investors often move their money into safer investments like U.S. Treasury bonds. This increased demand for bonds pushes their yields down, and since mortgage rates tend to follow the yield on the 10-year Treasury bond, mortgage rates also tend to fall.

How Does This Affect Your Purchasing Power?

Let's get down to brass tacks. How does this rate drop actually impact your ability to buy a home? The answer is simple.

  • With lower mortgage rates, the monthly payment for the same amount of mortgage decreases.
  • With the same monthly budget, you can afford a larger amount of mortgage.

The Redfin report illustrates this perfectly. They state that a homebuyer with a $3,000 monthly budget could afford a $446,000 home with a 6.9% mortgage rate. Just nine days earlier, when rates were around 7.13%, that same $3,000 budget would have only stretched to a $439,000 home. That’s an increase of $7,000 in purchasing power in a little over a week!

To put it another way, the monthly mortgage payment on the median-priced U.S. home (roughly $420,000) is now $2,760. Two weeks ago, it would have been $2,814. That $54 difference per month can add up over the life of a loan! That is more than $600 a year, and over a 30 year mortgage, that is a difference of over $18,000.

Important Considerations

It's easy to get caught up in the excitement of lower rates. But it's important to keep a few things in mind:

  • Housing costs are still near record highs. While rates have come down, home prices haven't necessarily followed suit. You'll still need to carefully evaluate your budget and what you can realistically afford.
  • Negotiating power varies by location. In some parts of the country, the supply of homes is increasing, giving buyers more leverage to negotiate on price and terms. However, in hot markets like the West Coast and Northeast, supply is still tight, and you may not have as much room to haggle.
  • Rates can fluctuate. As Redfin economists expect, rates are still expected to remain elevated between 6% and 7%. As someone who has seen rates change overnight, I advise that it is essential to keep an eye on it.

Expert Insight: A Window of Opportunity

Redfin Economic Research Lead Chen Zhao sums it up well: “House hunters who have been waiting on the sidelines, hoping for rates to come down, may want to act quickly while rates are below 7%.” He points out that economic and political uncertainty means rates could easily rebound.

Is Now The Right Time To Buy?

This is a question I get asked a lot, and honestly, there's no one-size-fits-all answer. The decision to buy a home is incredibly personal and depends on your individual circumstances, financial situation, and long-term goals. However, this drop in mortgage rates does present a potential window of opportunity for those who are ready and able to enter the market.

Here's a framework to help you decide:

  • Assess your financial situation. Can you comfortably afford a down payment, closing costs, and ongoing mortgage payments, even if rates tick up slightly? Are you prepared for unexpected expenses like home repairs?
  • Get pre-approved for a mortgage. This will give you a clear idea of how much you can borrow and demonstrate to sellers that you're a serious buyer.
  • Work with a real estate agent. A good agent can help you navigate the market, find properties that fit your needs, and negotiate effectively on your behalf.
  • Don't rush into anything. Take your time, do your research, and make sure you're making a sound financial decision that you'll be comfortable with for years to come.

Pros and Cons of Buying Now

Feature Pro Con
Mortgage Rates Lower rates increase affordability. Rates could rise again quickly due to economic uncertainty.
Housing Supply Increasing in some areas, giving buyers more negotiating power. Supply remains constrained in certain markets, limiting negotiating power.
Purchasing Power A small drop in rates can translate into a larger amount in the long-term. Can become a money pit quickly if one does not consider all other factors.
Market Timing Opportunity to lock in a rate before potential future increases. Buying decisions shouldn't solely be based on market conditions.
Financial Health If financial health is good, it may be a good time to expand net worth by investing into a property now. One should wait if they are expecting a major change in income, debts or expenses in near future.

The Bottom Line

The recent drop in mortgage rates is definitely something to celebrate. As someone who's been in the real estate industry for a significant amount of time, I've learned that timing the market perfectly is nearly impossible. What's more important is focusing on your individual needs and goals. If you're financially ready, have a stable job, and plan to stay in the home for the long term, then this slight dip in mortgage rates could be the nudge you need to finally make your homeownership dreams a reality. Don't let the fear of future rate increases paralyze you. Instead, focus on what you can control: your budget, your needs, and your willingness to take the plunge. Good luck!

Work with Norada in 2025, Your Trusted Source for

Real Estate Investing

With mortgage rates fluctuating, investing in turnkey real estate

can help you secure consistent returns.

Expand your portfolio confidently, even in a shifting interest rate environment.

Speak with our expert investment counselors (No Obligation):

(800) 611-3060

Get Started Now

Blog Posts

Contact

Norada Real Estate Investments 30251 Golden Lantern, Suite E-261 Laguna Niguel, CA 92677

(949) 218-6668
(800) 611-3060
BBB