2025 Market Predictions

NEW CONSTRUCTION
Inventory is higher than it has been for the past several years, which will make builders
cautious and might limit some starts. Expect custom home sales to be busy, but luxury
speculative home sales to be slower than 2023-2024. Regional builders will increase their
inventory and presence in mid and lower-price points.

LUXURY MARKET
Demand still outweighs supply in many areas, with buyers having a lot of cash to invest
in real estate. Expect “luxury collection” homes over $1 million to sell quickly.

FIRST-TIME HOME BUYERS
The sticker shock of higher interest rates is dissipating. Expect more homes for sale, but
multiple offer situations will continue. “Bidding wars” are scaling back, and buyers are
making their “first offer” their best offer.

MOVE-UP BUYERS
With limited inventory, it is still hard for move-up buyers to sell and buy simultaneously.
Buyers who don’t want to rent while they continue to look should talk with a lender about
buying first, and then taking advantage of a “recast” on the new loan when they sell.
Inventory will remain limited.

INVESTORS
Many investors are still looking to buy, but the return rates are much lower as prices
are higher. Long-term investments are still in play, but short-term investments don’t
necessarily offer positive cash flow. With many HOA’s limiting rentals, the market is
continually tightening.

RENTERS
Surprisingly, demand still outweighs supply. Renters are seeking out private landlords to
avoid national companies. Higher-end rentals are in especially short supply.