U.S. housing market projected to improve in 2025, but challenges like high mortgage rates persist.

From Investing.com: 2024-12-21 03:30:00

The U.S. housing market is projected to improve slightly in 2025, but challenges like high mortgage rates and affordability issues persist, according to a Bank of America report. Mortgage rates have rebounded to around 7%, limiting opportunities for buyers, while median home prices are four times the median income at $412,000.

Despite construction improvements, existing home inventories remain low due to high costs and interest rates. Resilient housing demand and wage growth could support the market, with existing home sales expected to reach 4.2 million in 2025 if mortgage rates stabilize. Renting remains cheaper in 82 out of 97 major U.S. cities.

Affordability is slowly improving but remains a concern, with median home prices still high relative to income. The road to recovery will be gradual as interest rates stabilize and wages outpace inflation. However, high mortgage rates will continue to pose challenges for buyers and sellers in the housing market.



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