Thinking about buying or selling a home in the next few years? My biggest takeaway from looking at the data and the trends is that we're looking at steady, but modest, home price appreciation, with a noticeable split between those feeling really optimistic and those who are a bit more cautious. Let's dive into the housing market predictions for the next 4 years, specifically from 2025 to 2029.

Housing Market Predictions for the Next 4 Years: 2026, 2027, 2028, 2029

It’s easy to get caught up in the headlines screaming about booms and busts, but my experience tells me that the reality is usually more nuanced. As someone who's been following this market for a while, I’ve seen how external factors – like interest rates, the job market, and even global events – play a huge role. The information I’m looking at today, particularly from Fannie Mae's Home Price Expectations Survey (HPES), gives us a really solid foundation for understanding what experts, the people who really live and breathe this stuff, are thinking.

So, what does this mean for you? If you’re planning to buy, it suggests that waiting for a massive price drop might not be the best strategy. If you’re looking to sell, it means your home is likely to continue holding its value, and even grow, albeit at a slower pace than we saw during the pandemic's peak.

The Big Picture: What the Experts Are Saying

Fannie Mae's latest survey, from Q3 2025, gives us a snapshot of what the brightest minds in the real estate world are predicting for home price growth. They surveyed a panel of experts and asked them to weigh in on where they see prices heading.

Here’s a breakdown of the average annual home price growth expectations from that survey:

• 2025: 2.4%
• 2026: 2.1%
• 2027: 2.9%

Now, these numbers might seem small compared to the eye-popping figures we saw in recent years, but that’s exactly what makes them so important. This indicates a return to a more normal, sustainable growth pattern.

My thoughts on these numbers: This isn't a prediction of a market crash, nor is it a runaway rocket ship. It’s a sign of a maturing market. After a period of incredibly rapid price increases, partly fueled by low interest rates and a surge in demand, the market is settling down. Think of it like a runner who’s just sprinted a marathon; they’re going to slow down to a steady jog to conserve energy and maintain their pace.

Looking Beyond the Average: The Optimists vs. The Pessimists

What makes the Fannie Mae survey even more insightful is that it doesn't just give us one single prediction. It breaks down expectations into different viewpoints: the “Optimists” and the “Pessimists.” This is crucial because it shows us the range of what people think could happen, and where the biggest uncertainties lie.

Let's look at the projected cumulative percentage value changes compared to the end of 2024:

Year	All Panelists (Mean)	Optimists (Mean)	Pessimists (Mean)
2025	2.4%	4.3%	0.5%
2026	4.5%	8.9%	-0.1%
2027	7.6%	14.5%	0.4%
2028	11.4%	20.1%	2.4%
2029	15.3%	25.8%	4.9%

What does this tell us?

The “Optimists” see a market that continues to climb, with significantly higher growth rates over the next few years, ending up with a cumulative increase of nearly 26% by 2029. These are the folks who likely believe that underlying demand, limited housing supply, and demographic trends will continue to push prices upward, even if there are temporary dips. They might be looking at factors like continued job growth, a desire for homeownership, and the fact that building enough new homes takes a very long time.

On the other hand, the “Pessimists” are looking at a much more subdued, or even slightly negative, outlook. Their cumulative growth expectation is just under 5% by 2029. This group might be more concerned about the lingering effects of higher interest rates, potential economic slowdowns, or a significant increase in housing inventory. They might be thinking that affordability will become a major constraint, forcing prices to stagnate or even fall in some areas.

My take on this division: This spread is what makes the housing market so fascinating and, frankly, so unpredictable at its fringes. The fact that there’s such a wide gap between the optimists and pessimists highlights the uncertainty surrounding future economic conditions. The optimists are betting on strong underlying fundamentals, while the pessimists are hedging their bets against potential headwinds.

For regular people like you and me, this means that location, location, location is more important than ever. Some markets, driven by strong local economies and limited supply, might follow the optimistic trajectory. Others, facing economic challenges or a flood of new construction, might lean towards the pessimistic outlook.

A Look Back to Understand the Future

To truly grasp where we're headed, it's always helpful to look at where we've been. Fannie Mae also provides historical data that gives us context for these future expectations.

Comparing Average Annual Home Price Growth Rates: History vs. Expectations (2025-2029):

• Pre-Bubble (1975-1999): 5.1% (average annual growth)
• Bubble (Q1 2000 – Q3 2006): 7.7%
• Bust (Q4 2006 – Q1 2012): -4.8% (average annual decrease)
• Post-Bust Recovery (Q2 2012 – Q1 2020): 4.5%
• Covid Reshuffling (Q2 2020 – Q1 2022): 8.7%
• Expected Annual Growth Rates 2025-2029 (All Panelists): 2.9% (average annual estimate)

What stands out here? Our recent Covid Reshuffling period saw some of the highest annual growth rates, similar to the pre-bubble era. The bust years were, of course, a stark reminder that prices don't always go up. The post-bust recovery period shows a more typical pace before everything heated up again.

Now, look at the expected annual growth rate for 2025-2029: around 2.9%. This is lower than the pre-bubble average and the Covid reshuffling period, and significantly lower than the bubble itself. It's more in line with, though slightly lower than, the post-bust recovery.

My observation: This comparison is telling. It suggests that the experts are anticipating a return to a more “normal” growth rate, one that existed before the extreme conditions of the pandemic. The lack of high inflation and the normalization of interest rates are key factors driving this expectation, in my opinion. It’s about stability returning to the market, which is good news for long-term homeowners and potential buyers who are worried about affordability.

What's Driving These Predictions? Key Factors to Watch

Predicting the future of any market is like trying to predict the weather – there are a lot of moving parts. But based on what I'm seeing and hearing, these are the big factors that will shape our housing market from 2025 to 2029:

1. Interest Rates: This is the elephant in the room. While rates have come down from their peak, they're still higher than many have become accustomed to. If rates continue to gently decline, it will boost affordability and encourage more buyers. If they stay elevated or rise again, it will put a damper on demand. The Federal Reserve's monetary policy will be critical to watch.
2. Housing Supply: The chronic shortage of homes is a major underlying factor. Building new homes takes time, and there are still many regions where demand far outstrips supply. This lack of inventory is a strong support for home prices. However, if we see a significant uptick in new construction, especially in areas that have seen rapid price growth, it could help balance things out.
3. Economic Stability and Job Growth: A strong economy with consistent job growth is vital for housing demand. When people feel secure in their jobs and incomes, they are more likely to buy homes. Any significant economic downturn or rising unemployment would put downward pressure on prices.
4. Demographics: Millennials continue to age into prime home-buying years, and this large generation will continue to fuel demand. While the pace of this demographic wave might be slowing, it's still a significant tailwind for the housing market.
5. Affordability: This is a double-edged sword. While higher prices have made homes less affordable, if wages keep pace and interest rates remain stable, affordability can gradually improve. However, if prices rise faster than incomes or interest rates jump, affordability will become a major hurdle.
6. Inflation: Persistent inflation can erode purchasing power and lead to higher interest rates as central banks try to control it. A stable, low-inflation environment is generally good for housing markets.
7. Geopolitical Events: Unexpected global events can have ripple effects on the economy, which in turn can impact the housing market. Think of supply chain issues or shifts in global investment.

My personal take: I emphasize affordability and supply as two of the most powerful forces. Even with good job growth, if people can’t afford the monthly payments, demand will falter. Conversely, if there are simply no homes to buy, prices often have nowhere to go but up, even with affordability challenges.

The Dispersion of Home Price Expectations: Trusting Your Gut vs. The Data

Looking at the dispersion of home price expectations from the Fannie Mae survey is really interesting. This chart shows how spread out the opinions are among the panelists over time. When the lines are far apart, it means there's a lot of disagreement and uncertainty. When they are close together, it suggests more consensus.

You can see that the dispersion of expectations has fluctuated. It peaked around 2021-2022, which was a period of extreme volatility and uncertainty due to the pandemic and the rapid shift in interest rates. More recently, the dispersion seems to be tightening a bit as we move closer to a more stable environment.

Why is this important? A wide dispersion means more risks and more potential for outliers. A tighter dispersion suggests more clarity and agreement among experts, leading to a more predictable market, even if that prediction is for modest growth.

My interpretation: The recent decrease in dispersion makes me a bit more confident in the general direction of the forecasts. It suggests that the experts are starting to see a clearer path forward, even if they disagree on the exact magnitude of change.

What Does This Mean for You? Actionable Insights

Now, let's translate these predictions into advice for you, whether you're considering buying, selling, or just want to understand your current home's value.

If you're looking to buy:

• Don't wait for a crash, but be budget-conscious: As I mentioned, a significant price crash isn't the dominant prediction. Focus on what you can afford comfortably, considering current and projected interest rates.
• Be prepared for persistent competition in desirable areas: Limited supply in strong markets will continue to drive demand and keep prices firm.
• Explore different financing options: With higher rates, understanding ARMs (Adjustable Rate Mortgages) or considering seller concessions might be part of your strategy.
• Location matters more than ever: Research local job markets, economic growth, and planned development. Some areas will undoubtedly outperform others.

If you're looking to sell:

• Your timing is likely good: The market is expected to continue appreciating, meaning your home should hold its value and likely increase.
• Price it realistically: While there's appreciation, avoid overpricing. A well-priced home in a steady market will attract serious buyers.
• Focus on presentation: In a market without extreme price surges, curb appeal and interior staging become even more important to attract offers.
• Consider the long-term outlook: If you don't need to sell immediately, holding onto your property could lead to further gains, given the optimistic outlook for longer-term appreciation.

For Homeowners:

• Your equity is likely to grow: Even at modest rates, your home is expected to continue building equity. This can be a valuable asset for future financial goals.
• Refinancing opportunities may arise: If interest rates drop significantly, you might have opportunities to refinance your mortgage to a lower rate, saving money over time.
• Stay informed: Keep an eye on local market trends, interest rate movements, and economic news.

The Road Ahead: A Normalizing Market

From where I stand, the housing market predictions for 2025 to 2029 paint a picture of a return to a more normalized environment. The frenzy of the pandemic years is behind us, and we're moving towards a period of steady, sustainable growth. This doesn't mean it will be boring; there will still be regional variations, economic shifts, and individual stories that make the market dynamic.

The Fannie Mae HPES provides a valuable guide, showing us that while there's a spectrum of opinions, the consensus leans towards continued, albeit moderate, appreciation. My hope is that this clarity helps you make informed decisions, whether you're a first-time buyer or a seasoned homeowner.

If you're dreaming of snagging a house for a steal, you're probably wondering: when will it be a buyer's market? The short answer, looking at current trends and expert projections, is that while we may see more balance in the market soon, a deeply advantageous buyer's market nationally isn't likely to arrive before late 2025 or even into 2026. Several factors, including mortgage rates, inventory levels, and overall economic growth, are at play here. Let's dive deep to understand why and what you can do to prepare.

Will It Be a Buyer's Housing Market in 2025 or 2026?

Before we delve into the data, let me share my perspective. Having followed the real estate market for years, I've learned that “buyer's market” and “seller's market” are relative terms. What feels like a good deal for a buyer in one city might be a seller's dream in another. And even within a city, different neighborhoods can behave uniquely. If you are sitting on the sidelines, a seasoned real estate professional will be very helpful.

Understanding the Current Market: A Snapshot

As of July 2025, the housing market presents a mixed bag. According to the National Association of REALTORS® (NAR), existing-home sales decreased by 2.7% in June. Let's break that down:

• Sales: Existing-home sales are down 2.7% month-over-month, sitting at a seasonally adjusted annual rate of 3.93 million. Year-over-year, sales are unchanged.
• Inventory: Total housing inventory is at 1.53 million units, a slight decrease of 0.6% from May but a significant 15.9% increase from June 2024. This translates to a 4.7-month supply, up from 4.6 months in May and 4 months a year ago.
• Prices: The median existing-home price hit a record high of $435,300, up 2% from last year. This marks the 24th consecutive month of year-over-year price increases!
• Mortgage Rates: The average 30-year fixed-rate mortgage is hovering around 6.75% (as of July 17), slightly up from the previous week but down from a year ago.

Regional Differences:

One of the biggest takeaways is that real estate is hyper-local. Here’s how different regions performed:

Region	Sales (Month-over-Month)	Sales (Year-over-Year)	Median Price
Northeast	-8%	-4.2%	$543,300
Midwest	-4%	+2.2%	$337,600
South	-2.2%	+1.7%	$374,500
West	+1.4%	-4.1%	$636,100

Key Observations:

• The Northeast and West are seeing sales declines both monthly and yearly.
• The Midwest and South witnessed sales increases year-over-year.
• Prices are up across all regions, but the West still commands the highest median price.

What Drives a Buyer's Market? The Core Ingredients

A true buyer's market happens when:

• Inventory Surges: There are more homes for sale than buyers. This gives buyers leverage because sellers compete for their attention.
• Prices Drop (or Stagnate): Over time, sellers reduce prices to attract buyers, or at least have to settle for little to no appreciation.
• Mortgage Rates Rise (or Stay High): Higher rates reduce buyer demand, further tilting the balance in favor of buyers.
• Days on Market Increase: Homes sit on the market longer, signaling a lack of urgency among buyers.

Projecting the Future: Expert Insights

So, when might these conditions align? Let's look at what the experts are saying.

Lawrence Yun's Predictions (NAR):

NAR Chief Economist Lawrence Yun offers some clarity. He believes:

• “Brighter days may be on the horizon.” While that doesn't scream “buyer's market,” it suggests a move toward greater market balance.
• Existing-home sales are expected to rise 6% in 2025 and 11% in 2026. This implies a recovery but not necessarily a market shift.
• New-home sales are projected to climb by 10% in 2025 and 5% in 2026. More construction could ease inventory pressures.
• Median home prices are forecasted to increase modestly by 3% in 2025 and 4% in 2026. This slows down appreciation may feel for like a mini buyer's market for some.
• Mortgage rates are anticipated to average 6.4% in the second half of 2025 and dip further to 6.1% in 2026.

Realtor.com Housing Forecast:

• Mortgage rates may ease slowly. We could see average rates matching the prior year, despite a dip to 6.4% by year-end.
• Home sales are expected to land at 4 million in 2025, just behind 2024.
• Home prices could climb, but growth is expected to slow further (+2.5%).

Analyzing the Forecasts: My Thoughts

Based on these expert analyses, I believe a true buyer's market nationwide is unlikely in the immediate future. Here is why:

• Modest Price Growth: Forecasted price increases, even if modest, don't scream “buyer's market.” Buyers get the most advantage from falling prices.
• Rising Sales: Predicted sales growth, both for new and existing homes, counters the notion of a buyer's market.
• Mortgage Rate Decline?: Any potential for mortgage rates to decrease could increase demand.

However, the projected slowing in price growth and potential inventory increases could create pockets of opportunity for buyers, especially if interest rates stay at the same levels. Individual markets, particularly those with high construction activity or regions experiencing population shifts, might experience a more pronounced shift toward a buyer's market sooner.

The Wildcards: Factors That Could Change Everything in 2025 and 2026

Predicting the future is never a sure thing. Here are some factors that could disrupt the current forecasts:

• Unexpected Economic Slowdown: A recession could trigger job losses and decreased demand, leading to a faster shift toward a buyer's market.
• Significant Increase in New Construction: If builders ramp up production far beyond current projections, inventory could surge, pressuring prices.
• Sudden Increase in Mortgage Rates: While less likely now, a sudden jump in rates could shock the market and cool demand rapidly, giving buyers more power.

What Can Buyers Do Now? Tips for Success

Even if a full-blown buyer's market isn't imminent, there are things you can do to position yourself for success:

1. Get Pre-Approved/Pre-Qualified: Knowing your budget is key. A good lender can also help you understand different mortgage products.
2. Strengthen Your Credit Score: A higher credit score means better interest rates, saving you money over the long term.
3. Save a Bigger Down Payment: A larger down payment can make your offer more attractive and reduce your monthly payments.
4. Research Different Markets: Consider markets where inventory is higher or prices are more stable. Don't get stuck on one neighborhood.
5. Work with an Experienced Agent: A good real estate agent can provide invaluable insights, negotiate expertly, and help you navigate the complexities of the market.
6. Be Patient and Flexible: Don't rush into a purchase. Be prepared to walk away from deals that aren't right for you, and be open to considering properties that might not have been on your initial wish list.

Summary: The Road Ahead

While a dramatic shift to a nationwide buyer's market might not happen overnight, the housing market is dynamic. By staying informed, preparing financially, and working with the right professionals, you can find opportunities and make smart choices regardless of the market conditions. Remember, real estate is a long play.

Let's talk about the housing market in 2025. It's a topic that gets a lot of people thinking, and maybe a little worried. While national numbers often paint a broad picture, the real story in real estate is always local. Based on recent expert analysis and market data, there are certainly areas showing significant vulnerability. If you're looking to buy or invest, or even sell, understanding where the risks might be highest is crucial. So, let's cut right to it: based on the latest insights, here are the 5 Riskiest Housing Markets to avoid in 2025 that may crash, or at least see significant price declines.

5 Riskiest Housing Markets to Avoid in 2025 That May Crash

Let's be clear from the start: when I say “crash,” I'm talking about the potential for significant price drops, not necessarily a repeat of 2008 across the board. The market dynamics are different now. However, rapid price appreciation combined with shifting economic factors and local inventory changes can create conditions ripe for a sharp correction, which for someone who bought at the peak, feels very much like a crash.

The Shifting Sands of the 2025 Housing Market

Before we dive into the specific risky markets, it's helpful to understand the bigger picture right now. According to the March 2025 data I've been looking at, the housing market's attempt at a spring revival was pretty short-lived.

According to the latest insights by Cotality (Formerly CoreLogic), March saw a bump in pending sales – about 12% higher than the year before – which you might think is a sign of strength. And yes, lower mortgage rates did help nudge some buyers off the fence. But here's the catch: year-over-year price growth actually slowed down, ticking in at 2.5% in March, down slightly from 2.9% in February.

Now, 2.5% growth isn't negative, but it's a far cry from the double-digit gains we saw during the pandemic frenzy. The forecast suggests price growth might speed up a bit by March 2026, perhaps hitting 4.9%, but that's a forecast, and a lot can change.

What I find particularly interesting is how much the market is splitting depending on where you look. You have states like Rhode Island, Connecticut, and New Jersey still seeing strong price growth, upwards of 7% year-over-year. Why? Well, as Chief Economist Selma Hepp points out, a severe lack of homes for sale in these areas, often combined with prices that are still relatively more affordable (median around $230,000 in the Midwest/Northeast mentioned), is propping things up.

On the flip side, states like Utah and Idaho, which saw explosive growth earlier, are now experiencing price drops – 2.1% and 2.2% respectively in March. This tells me that the party of non-stop appreciation is definitely over in some places, especially those that became severely unaffordable after huge run-ups.

And then there's a state like Georgia. The data shows prices hitting new records in parts of the state, maybe because folks are still moving south. But the overall state saw a negative price appreciation of -0.3% in March. This highlights a critical point: you can't just look at state-level data; you must look at specific metro areas.

Why Are Some Markets Looking Shaky?

The data points to a few key culprits making certain markets vulnerable:

1. Affordability Has Reached a Breaking Point: Markets like Florida and Texas saw cumulative price increases of 70% to 90% since the pandemic started. Think about that – home prices nearly doubled in just a few years! Meanwhile, incomes haven't kept pace. This creates a massive affordability problem. When homes are simply too expensive for the typical local buyer, demand starts to dry up unless there's constant migration of high-income earners.
2. Inventory is Rising, Fast: In many of these areas that boomed, builders ramped up construction, and perhaps homeowners who locked in super-low rates are now being forced to sell or deciding to cash out. The data specifically mentions “rapidly rising inventories” in weakened markets like Florida and Texas. When there are suddenly more homes for sale than buyers willing or able to purchase them, prices have to adjust downwards. It's basic supply and demand.
3. Higher Costs Hit Harder in Stretched Markets: Mortgage rates, property taxes, insurance (especially in areas prone to climate risks like Florida) – these non-mortgage costs eat into affordability. In markets where people are already stretched thin because of high prices, these extra costs can be the straw that breaks the camel's back, pushing even more potential buyers out of the market.
4. Consumer Jitters: The Chief Economist mentioned consumer concerns about personal finances, job prospects, and wider economic worries. This kind of uncertainty makes people hesitant to make the biggest purchase of their lives, further slowing demand, especially in markets that rely on continued strong buyer confidence.

When you combine sky-high prices built on rapid appreciation, increasing inventory, and buyers pulling back due to costs and uncertainty, you have a recipe for potential price declines. This is precisely what seems to be happening in several areas, particularly in Florida and Texas, which the data highlights as weakened states, now joining places like Hawaii and Washington D.C. in showing negative price changes in March. In fact, eight out of eleven markets measured in Florida saw negative annual changes. That's significant!

The data by Cotality also provides a list of the “Coolest Markets” based on year-over-year price change. Look at some of the places on that list: Fort Myers, FL (-5.3%), Punta Gorda, FL (-4.1%), Sarasota, FL (-3.6%), Victoria, TX (-4.6%), Coeur D'Alene, ID (-3.4%), Pocatello, ID (-3.1%). Many of these saw massive price increases during the pandemic boom and are now correcting. This reinforces the idea that areas with huge, rapid gains are often the most vulnerable when conditions shift.

The Core Concern: The 5 Riskiest Markets

Based on the specific “Markets to watch” identified in the data as having a “very high risk of price decline” among the top 100 metro areas, here are the five markets that appear to be on shaky ground heading into 2025:

• 1. Albuquerque, New Mexico
• 2. Atlanta, Georgia
• 3. Winter Haven, Florida
• 4. Tampa, Florida
• 5. Tucson, Arizona

Let's break down my perspective on why these specific markets are flagged, based on the provided data and charts:

1. Albuquerque, New Mexico

Looking at the high-risk market price trend chart, Albuquerque's line is one of the lower ones, but critically, it shows a noticeable dip recently, especially towards the end of 2024 and into early 2025. While it had a run-up in the post-pandemic boom, it didn't reach the extreme peaks seen in some other cities on this risky list. However, any market that shows a recent downturn after a period of appreciation is concerning.

My take: Albuquerque is a smaller market than places like Atlanta or Tampa. Smaller markets can sometimes be more susceptible to volatility if major employers shrink or leave, or if inventory jumps significantly without enough incoming demand. The recent price dip in the chart suggests supply might be starting to outweigh demand, or buyers are simply saying “no” at current price levels after the earlier growth.

2. Atlanta, Georgia

This one is interesting. The data states that Georgia overall saw negative price appreciation (-0.3%) in March, even though parts of the state hit record prices. Atlanta is the major metro area driving Georgia's housing market narrative. The chart for Atlanta shows a significant peak in mid-2022, followed by a noticeable dip, then a bounce back up in late 2023/early 2024, and now seems to be showing another plateau or slight downturn heading into March 2025.

My take: Atlanta attracted massive numbers of new residents during the pandemic thanks to its relative affordability (compared to coastal cities), job market, and quality of life. However, that popularity drove prices up dramatically. The negative state-level data combined with the volatile price trend line for Atlanta in the chart suggests that affordability is now a major challenge for many potential buyers. Plus, Atlanta is a major metro, which often sees more development and potentially faster inventory increases than smaller towns. This combination of stretched affordability and potential inventory growth puts it at risk.

3. Winter Haven, Florida

Florida markets feature heavily on this risky list, and for good reason, as the data repeatedly points out Florida as a “weakened” state with negative annual changes in many markets. Winter Haven is specifically called out as “one of the top five most at-risk markets in the country.” Looking at its price trend on the chart, Winter Haven saw a huge percentage increase from early 2021 to mid-2022, perhaps one of the most dramatic run-ups on that specific chart. Since its peak, prices have been volatile, showing significant drops followed by partial recoveries, but the trend seems flatter or even slightly down heading into 2025 compared to its peak.

My take: Winter Haven is part of Central Florida, an area that became incredibly popular due to relative affordability compared to South Florida or coastal areas, plus attractions and jobs. But that rapid popularity led to massive price spikes. When prices go up 70-90% in just a few years across the state, markets like Winter Haven, which saw some of the most explosive growth, become extremely vulnerable. They likely reached or exceeded what local incomes can support, and as inventory rises (which the data confirms is happening across Florida), prices have less support.

4. Tampa, Florida

Another Florida market on the list. Like Winter Haven, Tampa saw a very strong price increase from 2021 to 2022 according to the chart, peaking around mid-2022. It then saw a significant correction, a slight rebound, and now the line appears to be trending downwards again towards March 2025. Tampa is a much larger metro area than Winter Haven but faced similar pressures: huge influx of residents, rapid price growth, and now dealing with the state-wide issues of rising inventory and affordability challenges mentioned in the data.

My take: Tampa's economy is more diverse than some smaller Florida towns, but it still experienced an unsustainable surge in home values. It's a classic example of a market where demand outpaced supply dramatically for a time, driving prices sky-high. Now, as supply catches up and affordability bites, the market is struggling to sustain those peak prices. The chart clearly shows volatility and a recent downward trend reinforcing its high-risk status.

5. Tucson, Arizona

Tucson also saw substantial price growth through 2021 and 2022, peaking in early 2023 according to the chart. Since that peak, the trend has been choppy but generally downwards or flat, with a notable dip in late 2024 and early 2025. While the data specifically calls out Utah and Idaho for Western state price drops, Arizona markets like Tucson often follow similar patterns as they attracted remote workers and migrants seeking lower costs than California during the boom.

My take: Similar to other boomtowns, Tucson's rapid appreciation likely pushed it beyond the reach of many local buyers. As the national economy cools and remote work policies potentially shift, the influx of high-earners might slow, while increased inventory (either from new builds or people needing to sell) puts downward pressure on prices. The chart's recent downward movement makes its inclusion on this high-risk list understandable.

My Perspective on These Risks

As someone who watches market trends closely, I believe the key takeaway from this data and this list of risky markets isn't panic, but awareness. These are markets that went through a period of hyper-growth that simply wasn't sustainable relative to underlying economic fundamentals like local wages.

When I look at these five cities, I see common threads: they likely experienced massive price pumps over the last few years, attracting investors and out-of-state buyers, but potentially leaving local residents behind. Now, as interest rates make borrowing more expensive and inflation eats into savings, combined with rising options for buyers (more houses on the market), the scales are tipping.

Think about it: if a home's price doubled, but local salaries didn't, who is left to buy it when investors step back and migration slows? This is where you see prices start to slide. The data confirms this dynamic, particularly highlighting the “cumulative price increases since the pandemic” as a major factor in states like Florida and Texas becoming “weakened.”

This isn't just academic for me; it influences how I'd advise friends or family looking at these specific areas. I'd tell them to do extra homework. Look specifically at inventory trends in that metro area. How long are homes sitting on the market? Are sellers having to cut prices? Are there a lot of new construction developments finishing up? These ground-level details, combined with the high-risk flags from expert analysis, give a much clearer picture than national headlines.

Beyond the Top 5: Warning Signs in Other Areas

While these five markets are flagged as the riskiest among the top 100 metros, the data suggests the vulnerability isn't limited to just them. The list of “coolest markets” provides further clues. Seeing multiple Florida cities on that list reinforces the widespread nature of the price softness in that state. Similarly, markets in states like Texas and Idaho appearing on that list align with the general trends the report identifies in those regions.

It's a reminder that even if a city isn't on the “top 5 riskiest” list, if it experienced a massive pandemic boom and is now seeing inventory rise or sales slow, it could still be facing a significant price correction in 2025.

What Does “Crash” Really Mean Here?

Again, let's manage expectations. A “crash” in this context is likely referring to a significant correction – perhaps 10%, 15%, or even 20%+ declines from the peak values reached during the frenzy. For someone who bought near the top with a small down payment, a 15-20% drop can wipe out their equity, which feels devastating. For investors who bought speculating on continued rapid growth, it can mean losses.

It's less likely (though not impossible in specific micro-markets) to see the kind of nationwide 30-50% drops some experienced in 2008, primarily because lending standards have been much tighter. However, prolonged stagnation or gradual decline can also be painful for sellers and impact the broader economy. The risk highlighted for these five markets is that the price declines could be sharper or more sustained than elsewhere.

Who Should Be Concerned?

• Potential Buyers in These Markets: This data is a giant yellow flag. You have more leverage than sellers might admit. Do your research, don't overpay, and be prepared for the possibility that the home's value might drop after you buy it. That's less concerning if you plan to stay long-term, but critical if you might need to sell in the next 3-5 years.
• Potential Sellers in These Markets: You might need to adjust your expectations significantly. The days of putting a sign in the yard and getting multiple offers over asking price are likely over. You'll need to price competitively based on current conditions, not peak 2022 values.
• Investors in These Markets: If you bought rental properties or flips expecting quick appreciation, the next few years could be challenging. Negative price movement impacts equity and makes flipping harder. Rental markets are also complex and tied to local economies.

Wrapping It Up

The housing market in 2025 is shaping up to be highly localized. While some areas in the Northeast and Midwest are holding steady or even seeing modest growth thanks to limited inventory and relative affordability, markets that saw explosive, potentially unsustainable growth during the pandemic are now facing headwinds.

The data points to Albuquerque, Atlanta, Winter Haven, Tampa, and Tucson as particularly risky, showing trends and underlying factors that increase the likelihood of price declines or significant corrections.

Understanding these risks isn't about predicting the future with 100% certainty, but about making informed decisions. If you're considering a move or investment in one of these areas, proceed with extra caution, do thorough local research, and perhaps consult with a real estate professional who truly understands the current dynamics in that specific metro, not just the national headlines. The goal is to avoid stepping into a market that could see your investment shrink in the near term.

Thinking about buying or selling a home? You're probably wondering what's going to happen with housing prices. Well, according to a recent report from J.P. Morgan, housing prices are expected to rise by about 3% in 2025. While this isn't the crazy price surge we saw a few years back, it's still something important to consider whether you're looking to make a move or just keeping an eye on your investment. Let's dive deeper into why they're predicting this and what it could mean for folks like you and me.

Housing Market Forecast 2025: J.P. Morgan's Predictions

Why the Continued Rise? Low Supply and Stubborn Interest Rates

Now, a 3% increase might seem modest, especially after the rollercoaster ride the housing market has been on. But to really understand why J.P. Morgan is predicting this, we need to look at a couple of key factors: low housing supply and interest rates that aren't dropping as much as some might hope.

From my perspective, and what the experts at J.P. Morgan are also pointing out, the biggest issue is that not a lot of people are selling their homes right now. Think about it: many homeowners locked in really low mortgage rates a few years ago. With current rates being significantly higher, it doesn't make a lot of financial sense for them to sell their place and then have to buy a new one at a much higher interest rate. This creates a sort of standstill in the market. If people aren't selling, there aren't as many houses available for those who want to buy.

John Sim, the head of securitized products research at J.P. Morgan, hit the nail on the head when he said that the lack of supply is primarily a “lock-in issue.” He pointed out that a large majority of borrowers have mortgage rates that are at least a full percentage point lower than what's currently available. That's a big disincentive to move!

Despite this low supply, demand from buyers has also been somewhat subdued, largely due to those higher interest rates making monthly mortgage payments less affordable. It's a bit of a Catch-22.

The “Wealth Effect” – A Key Reason for Price Stability

So, if both supply and demand are low, why aren't prices just staying flat or even dropping? This is where something called the “wealth effect” comes into play. According to J.P. Morgan, many current homeowners have built up significant equity in their homes, meaning they own a larger portion of their home's value outright. Additionally, growth in the stock market has boosted the wealth of many individuals.

In my opinion, this wealth provides a cushion. Even if affordability is stretched for some potential buyers, those who already own property are generally in a good financial position. This existing wealth, combined with some continued, albeit slower, demand, is expected to keep housing prices on an upward trajectory, even if it's at a “subdued pace,” as J.P. Morgan describes it.

Other Experts Agree: A General Consensus for Rising Prices

It's not just J.P. Morgan predicting a rise in housing prices for 2025. Reports from the National Association of Realtors and Redfin also anticipate an increase in the median existing home sales price, around 3.7%. This general agreement among different experts adds more weight to the expectation of continued price growth.

However, it's important to remember that these are national forecasts. Local market conditions can vary quite a bit. What's happening in one city or state might be very different from what's happening in another.

What Does This Mean for Future Homeowners?

If you're hoping to buy a home in 2025, this news might feel a bit discouraging. A 3% price increase, on top of already high prices and interest rates, can make the dream of homeownership even harder to reach.

• For First-Time Buyers: You might need to save even more for a down payment and closing costs. It also reinforces the importance of getting pre-approved for a mortgage to understand what you can realistically afford. Exploring different loan programs and down payment assistance options could also be beneficial.
• For Current Renters: If you're on the fence about buying, the expectation of rising prices might push you to consider making a move sooner rather than later, if your financial situation allows.

It's also worth noting that while mortgage rates are expected to ease slightly to around 6.7% by the end of 2025, according to J.P. Morgan, they aren't predicted to drop dramatically. This means affordability will likely remain a significant challenge for many.

What Does This Mean for Current Homeowners?

If you already own a home, the prediction of a 3% price increase in 2025 is generally positive news. It suggests that your property value is likely to continue appreciating, adding to your wealth.

• For Potential Sellers: While prices are expected to rise, the low supply situation means there might not be a huge rush of buyers. If you're planning to sell, it's still important to price your home competitively and make sure it's in good condition to attract potential buyers. However, you also need to consider where you'll go next and the higher interest rates you might face if you plan to buy another property.

The Wildcard: Potential Impact of a Second Trump Administration

J.P. Morgan also touched on the potential impact of a second Trump administration on the housing market. While specific housing policies haven't been detailed, some potential areas of influence include:

• Zoning Approval Processes: Proposals to streamline these processes could potentially speed up construction timelines and increase housing supply in the long run. However, this often happens at the local level.
• Federal Land Availability: Making more federal land available for building could also help increase the housing stock.
• Immigration Policies: More restrictive immigration policies could lead to labor shortages in the construction industry, potentially hindering new construction and exacerbating the supply issue. On the demand side, reduced immigration could theoretically lessen demand for housing, but the impact isn't straightforward.

John Sim from J.P. Morgan noted that cutting immigration could reduce the labor supply in construction, which might actually make affordable housing even harder to come by. It's a complex issue with potential unintended consequences.

Efforts to Reduce Housing Costs: A Look at California

The high cost of housing, particularly in states like California, is a major concern. Lawmakers are exploring ways to make housing more affordable by addressing the lack of supply. In California, where there's an estimated shortage of 2.5 million homes, bipartisan legislators have proposed over 20 bills aimed at fast-tracking the housing approval process to make building easier and more efficient. These efforts highlight the recognition that increasing supply is a crucial step in tackling housing affordability.

My Final Thoughts: A Slow and Steady Market

Based on the data and expert opinions, including those from J.P. Morgan, it looks like the housing market in 2025 will continue to see price growth, but at a much slower and more “subdued” pace than what we've experienced in recent years. The combination of low existing home inventory due to the interest rate lock-in and a demand side that's being kept in check by affordability concerns is creating a somewhat frozen market.

While a 3% increase might not be dramatic, it's still a factor that potential buyers and sellers need to consider. For buyers, it means the window of opportunity for prices to drop significantly might not be opening anytime soon. For sellers, it suggests continued appreciation, but the lower demand might require a more strategic approach to selling.

Ultimately, the housing market is influenced by a complex interplay of economic factors, and while forecasts provide valuable insights, they aren't guarantees. It's always a good idea to keep a close eye on local market trends and consult with real estate professionals for advice tailored to your specific situation.

Everyone's been whispering about it: Will the housing market finally crash in 2025? Well, according to the financial guru Dave Ramsey, the answer is a firm no. His 2025 housing market predictions suggest we won't see a collapse. Instead, Ramsey points towards a market that's stabilizing, with prices remaining relatively high and mortgage rates unlikely to plummet back to the historic lows we once saw. This is crucial information if you're thinking of buying, selling, or just trying to understand where things are headed in the real estate world.

Housing Market Predictions 2025 by Dave Ramsey: Will it Crash?

I've been keeping a close eye on the housing market myself, and honestly, Ramsey's outlook aligns with what I'm seeing on the ground. While the frantic pace of the past few years has certainly cooled down, the fundamental factors that would lead to a major crash just don't seem to be in place. Let's dive deeper into what Ramsey and the data suggest for the year ahead.

Will Mortgage Rates Ever Go Down Significantly?

If you're holding out for mortgage rates to return to those sweet 3% days, Ramsey suggests it's time to adjust your expectations. The Mortgage Bankers Association indicated that the average 30-year fixed-rate mortgage peaked at around 7.79% in late 2023 and has since settled somewhat, sitting around 6.89% at the start of 2025.

Ramsey's prediction is that we'll likely see rates stabilize around the 6.5% mark, but a significant drop below that isn't anticipated. Factors like ongoing inflation and the Federal Reserve's policies will continue to play a role in keeping rates at a more moderate level.

My take on this? I agree with Ramsey. The era of ultra-cheap mortgages was largely an anomaly. While I wouldn't rule out minor fluctuations, I think a return to those rock-bottom rates is unlikely in the near future. If you're in a solid financial position to buy, waiting for a significantly lower rate could mean missing out on a home you love, especially if prices continue their upward trend, even if at a slower pace.

Is Now a Good Time to Buy a House? Dave Ramsey's Perspective

Forget about trying to perfectly time the market – it's a fool's errand, as Ramsey often says. The real question isn't about the “perfect” market conditions, but rather whether you are in a good financial position to buy.

Here's Dave Ramsey's straightforward advice on when it's a good time for you to buy:

• You are completely debt-free (excluding your mortgage).
• You have a fully funded emergency fund that covers 3 to 6 months of your living expenses.
• You can comfortably afford a 15-year fixed-rate mortgage with monthly payments that are no more than 25% of your take-home pay.
• You have a solid down payment. While a 20% down payment is ideal to avoid private mortgage insurance (PMI), Ramsey acknowledges that 5-10% can be workable for first-time buyers. He generally advises against FHA and VA loans due to their additional fees.

In my experience, Ramsey's principles are spot on. Buying a home is a huge financial commitment, and going into it with a strong financial foundation is the best way to ensure long-term success and peace of mind, regardless of short-term market fluctuations.

How Will President Trump's Policies Affect the Housing Market?

With Donald Trump now back in the Oval Office, many are wondering what impact his policies might have on the housing market. Ramsey's report correctly points out that presidents don't directly control mortgage rates or housing prices – those are primarily driven by supply and demand. However, policy changes can certainly exert influence.

Here are some potential areas where President Trump's administration could nudge the housing market:

• Zoning Laws: We might see efforts to loosen zoning restrictions at the federal level or incentives for states and localities to do so. This could potentially increase the supply of new housing over time, which could help moderate price growth.
• Infrastructure Spending: Increased investment in infrastructure projects could make certain areas more attractive, potentially boosting home values in those regions.
• Federal Land Use: Opening up more federal land for development could lead to an increase in available housing in some areas.

It's important to remember that these types of policy changes tend to have a gradual impact rather than causing immediate shifts. While political factors can influence the market, your personal financial situation should always be the primary driver of your home-buying decisions.

Why a Housing Market Crash in 2025 is Unlikely

For those hoping for a major housing market crash, Ramsey offers a clear perspective: it's not in the cards for 2025. This aligns with projections from entities like the Federal Home Loan Mortgage Corporation, which anticipates home prices to continue rising in the coming year, albeit likely at a more moderate pace.

The fundamental reasons why a crash like the one in 2008 is unlikely include:

• No Over-Supply: Unlike the pre-2008 era, we don't have a massive oversupply of homes on the market. In fact, in many areas, inventory remains relatively tight.
• Strong Buyer Demand: Despite higher mortgage rates, there's still a significant underlying demand for housing. People need places to live, and for many, homeownership remains a key financial goal.
• Stricter Lending Practices: Lending standards are much tighter now than they were in the lead-up to the 2008 crisis. This means borrowers are generally more qualified and less likely to default on their mortgages.
• More Home Equity: Homeowners today typically have more equity in their homes compared to the pre-2008 period, providing a buffer against potential price declines.
• Low Foreclosure Rates: As reported by ATTOM Data, foreclosure activity actually dropped by 10% in 2024, and this trend is expected to continue. There isn't a looming wave of foreclosures that would flood the market and drive down prices.

In my opinion, focusing on increasing your income, saving diligently, and getting your financial house in order is a much more productive approach than waiting for a crash that probably won't materialize.

Understanding Average vs. Median Home Prices in 2025

When we talk about home prices, it's important to understand the difference between the average and the median. According to Federal Reserve Economic Data, the average U.S. home price at the end of 2024 was around $510,300. However, the median home price, which gives a more representative picture by excluding the impact of very high or low-priced homes, was approximately $419,200.

The reason the average is higher is that a relatively small number of very expensive homes can skew the overall average upwards. The median provides a better sense of what a typical home is selling for.

While home values have continued to rise in most areas, the dramatic price surges we saw during the 2020-2022 period have definitely calmed down. Prices aren't crashing, but they aren't skyrocketing either – they appear to be stabilizing. If you're in the market, especially in areas with limited inventory, expect to pay close to the asking price for desirable properties.

Inventory Levels: Are More Homes Becoming Available?

Housing inventory has been a significant challenge for buyers for quite some time. While there's some positive news on this front, it's important to keep it in perspective. January 2025 marked the 15th consecutive month of inventory growth. Realtor.com reported that the number of available homes was about 24.6% higher than the previous year. This is a step in the right direction, giving buyers slightly more options.

However, it's crucial to note that inventory levels are still significantly below where they were before the pandemic in 2020. This means that while the situation is improving, buyers still don't have the abundance of choices they once did, and this limited supply continues to put upward pressure on prices in many markets, especially in high-demand cities where new construction struggles to keep pace. While a healthier market is forming, don't expect a sudden surge in available homes.

Buyer Demand: Is It Still Going Strong?

Despite mortgage rates hovering above 6.5%, buyer demand hasn't disappeared. Redfin's data from January 2025 showed that 22.4% of homes sold for more than their asking price, indicating that there's still plenty of competition for desirable properties.

While demand typically follows seasonal patterns – stronger in the summer and slower in the winter – the overall trend remains relatively steady. If mortgage rates were to dip below 6.5%, we could likely see an even greater influx of buyers entering the market, further intensifying competition.

For those hoping for a significant drop-off in buyer demand, it's likely they'll be disappointed. The fundamental need for housing remains, and with inventory still constrained, demand isn't expected to wane dramatically.

2025: A Buyer's or Seller's Market? Dave Ramsey's Take

According to Dave Ramsey's analysis, the housing market is currently in a transitional phase, but sellers still generally hold the upper hand in most areas. The persistent imbalance between supply and demand means that well-priced homes in good locations are still selling relatively quickly.

That being said, the extreme bidding wars and rapid-fire offers we saw during the peak of 2021-2022 have subsided somewhat. Buyers have a little more time to consider their options and aren't always pressured into making lightning-fast decisions on overpriced properties. Sellers who try to push prices too high, expecting a frenzy, might find their homes sitting on the market longer.

The key for sellers in 2025 will be to price their homes realistically. Buyers are more discerning now and are less willing to overpay for a property that doesn't meet their expectations or budget.

Will There Be a Significant Increase in Foreclosures in 2025?

Dave Ramsey does not anticipate a surge in foreclosures in 2025. Data from ATTOM indicates that foreclosure rates actually decreased in 2024, and this trend is expected to continue.

Several factors contribute to this outlook:

• Stricter Lending Standards: As mentioned earlier, lending practices are much more rigorous now, meaning borrowers are generally more creditworthy.
• Greater Homeowner Equity: Many homeowners have built up significant equity in their properties, providing a financial cushion.
• A Relatively Strong Economy: While there are always economic uncertainties, we aren't currently facing the kind of widespread economic distress that could trigger a massive wave of defaults.

For buyers hoping to find deeply discounted foreclosure deals, the pickings are likely to remain slim due to the low overall foreclosure inventory. Waiting for an economic collapse to flood the market with cheap homes is likely to be a long and ultimately unsuccessful strategy.

How to Buy a Home with Confidence in the 2025 Market

Navigating the 2025 housing market requires a focus on financial preparedness rather than trying to predict market swings. Dave Ramsey's time-tested advice for confident home buying remains relevant:

• Get your financial house in order: This means paying off all non-mortgage debt and building a solid emergency fund.
• Save a substantial down payment: Aim for at least 20% if possible, but understand that 5-10% might be a starting point for some first-time buyers.
• Stick to a 15-year fixed-rate mortgage: Avoid the risks associated with adjustable-rate mortgages and the extra fees often tied to government-backed loans.
• Ensure your monthly mortgage payment (including principal, interest, property taxes, and insurance) is no more than 25% of your take-home pay.
• Work with a knowledgeable real estate agent: A good agent who understands the local market can provide invaluable guidance.

In my own experience, focusing on these fundamentals will put you in the strongest possible position to buy a home that fits your needs and budget, regardless of the market's minor ups and downs.

How to Sell Your Home for the Best Price in 2025

While Ramsey believes sellers still have a slight advantage, simply listing your home at an inflated price and expecting a bidding war is no longer a viable strategy in most markets. Here's how to maximize your selling price in 2025:

• Price your home strategically: Work closely with your real estate agent to determine a competitive and realistic listing price based on recent comparable sales in your area. Overpricing can lead to your home sitting on the market, eventually requiring price reductions that can make buyers wonder what's wrong with the property.
• Prepare your home for sale: Invest in minor upgrades and repairs, such as fresh paint, fixing leaky faucets, and ensuring everything is clean and well-maintained. First impressions matter.
• Stage your home effectively: Help buyers envision themselves living in the space by decluttering and arranging furniture in an appealing way. Consider professional staging for the best results.
• Take high-quality photos: In today's market, most buyers start their search online. Professional, well-lit photos are crucial for attracting attention and generating showings.
• Be prepared to be flexible: While it's still a seller's market in many areas, buyers are becoming more selective. Be open to negotiating and addressing reasonable requests.

Sellers who are realistic about pricing and presentation are the ones who will ultimately achieve the best results in the 2025 market.

The Bottom Line: Navigating the 2025 Housing Market

Dave Ramsey's 2025 housing market predictions point to a market that is stabilizing rather than crashing. While mortgage rates are higher than in recent years, they are expected to remain relatively steady. Home prices are also holding firm, with inventory showing some improvement but still remaining below pre-pandemic levels. Buyer demand continues to be resilient, giving sellers a slight edge in many areas.

The key takeaway, according to Ramsey, is that timing the market is less important than being financially prepared. Whether you're looking to buy or sell, focusing on your individual financial situation and making sound, well-informed decisions is the best approach to navigating the 2025 housing market successfully. Don't wait for a drastic market shift that may never come; instead, make a move when your personal finances are solid and the time is right for you.