February 2025 Housing Market Update: Are We Heading for a Shift?

Are you thinking about buying a home, selling one, or just trying to determine if now is the right time to make a move? The market is changing, and depending on where you stand, that could be a good thing—or a challenge.

Prices are still climbing, but more homes are hitting the market. Mortgage rates have dipped slightly, but they’re still high enough to make buyers hesitate. Sellers are coming back, but not every home is moving quickly. With so many moving pieces, it can be hard to tell if now is the right time to jump in or sit tight.

So, what’s really going on in the market? Is it finally shifting in favor of buyers, or will high prices and mortgage rates keep things slow?

At Nuvision, we know that making smart financial decisions starts with having the right information. That’s why we put together these housing reports each month—to break down the latest trends and help you understand what they mean for you.

Let’s  take a look at the latest insight and analysis from Zillow, Redfin, the National Association of Realtors, and housing expert Steven Thomas.

Zillow: More Sellers Enter the Market, But Buyers Remain Cautious

Existing home sales fell 4.9% in January, bringing the seasonally adjusted annual rate to 4.08 million. Despite the monthly drop, sales were still 2% higher than in January 2024. Total housing inventory increased to 1.18 million units, marking a 16.8% rise from a year ago. While more homes are hitting the market, demand remains slow to start the year.

Mortgage rates continue to be the biggest factor holding buyers back. After creeping higher in December, rates began easing in mid-January, but affordability challenges persist. Zillow notes that while sellers are returning, the number of buyers hasn’t caught up yet. The firm’s latest forecast predicts home values will rise by just 0.9% in 2025, down from the previously expected 2.9%. With inventory growing and demand still weak, home prices could see more stability in the months ahead.

Redfin: Mortgage Rates Hit Two-Month Low, Giving Buyers More Power

For the first time in months, homebuyers are seeing a window of opportunity. Mortgage rates have dipped to their lowest level since mid-December, giving buyers slightly more purchasing power. A homebuyer with a $3,000 monthly budget can now afford a $446,000 home at today’s 6.9% rate, compared to just $439,000 earlier this month when rates were above 7%.

Housing supply has also increased, with five months of inventory on the market—the highest level since early 2019. Homes are selling for 2% under asking price on average, the biggest discount seen in two years. While affordability remains a challenge, buyers who are ready to act now have more negotiating power than in recent years. However, Redfin notes that competition for well-priced homes in desirable locations remains strong.

National Association of Realtors (NAR): Home Sales Down, But Prices Keep Rising

According to the National Association of Realtors, existing home sales declined 4.9% in January, but year-over-year sales continued their upward trend, marking the fourth consecutive month of annual gains. The median home price climbed to $396,900, a 4.8% increase from January 2024. While home prices keep rising, inventory levels have also increased, giving buyers more options.

Affordability remains a significant barrier, with mortgage rates stuck around 6.85%. Buyers are taking longer to make decisions, and homes are staying on the market an average of 41 days—up from 35 days in December. Cash buyers remain a strong presence in the market, accounting for 29% of January transactions. While more homes are available, NAR notes that many would-be buyers are still waiting for a more substantial drop in mortgage rates before jumping in.

Steven Thomas: More Homes on the Market as Spring Approaches

Housing inventory is up 56% from last year, marking the highest mid-February levels since 2020. More homeowners are deciding to sell, and more inventory is expected as the market moves into spring. However, uncertainty surrounding mortgage rates and affordability is keeping demand from fully rebounding.

Looking Ahead: How the Economy Could Shape the Housing Market

Housing trends are only part of the bigger picture. Home prices, mortgage rates, and inventory are all influenced by broader economic forces—things like inflation, interest rates, and government policy. Right now, rising tariffs, stubborn inflation, and uncertainty in the stock market are creating ripple effects that could impact both homebuyers and sellers.

Will mortgage rates continue to ease, or will economic pressures push them higher? Will home prices stabilize, or are bigger shifts in the economy coming?

To get the important insight you need not only for the mortgage market, but the overall economic landscape, we’re hosting a special Economic Forecast webinar featuring Dr. Christopher Thornberg of Beacon Economics on March 18, 2025. He’ll break down what’s happening in the economy and what it means for the housing market—helping you understand whether now is the right time to buy, sell, or wait.

No spin, no sugarcoating—just the facts you need to make smart financial decisions.

Event Details:

Date: March 18, 2025
Time: 5:30 PM – 6:30 PM PST | 4:30 PM – 5:30 PM AKST
Where: Online (Live Webinar via Zoom)

CLICK HERE TO REGISTER

At Nuvision, we provide more than just financial services—we help our members stay ahead. Whether it’s through these housing reports or exclusive events like our Economic Forecast webinar, we’re here to equip you with the knowledge you need to navigate 2025 with confidence.