N※N

Sports and Competition
Source : (remove) : ecr.co.za
^{RSS • JSON • XML • CSV}

Sports and Competition
Source : (remove) : ecr.co.za
^{RSS • JSON • XML • CSV}

Economists, experts say status quo for mortgage rates, home prices

Economists and Experts Predict Status Quo for Mortgage Rates and Home Prices in 2025

In a landscape marked by economic uncertainty, a chorus of economists and real estate experts is forecasting that mortgage rates and home prices will largely remain stable throughout 2025. This prediction comes amid ongoing debates about inflation, Federal Reserve policies, and the broader housing market's resilience. While some regions may see minor fluctuations, the overall consensus points to a "status quo" scenario, where neither dramatic spikes nor significant drops are expected. This outlook provides a measure of relief for potential homebuyers and sellers alike, who have been navigating a volatile market in recent years.

Leading the charge in this assessment is a recent report from the National Association of Realtors (NAR), which surveyed over 200 economists and housing analysts. The report suggests that average 30-year fixed mortgage rates, currently hovering around 6.5% to 7%, are unlikely to deviate much from this range. "We're entering a period of relative calm," said Dr. Elena Ramirez, chief economist at NAR. "The Federal Reserve's cautious approach to interest rate adjustments, combined with steady employment figures, should keep borrowing costs predictable." Ramirez points to the Fed's recent decision to hold rates steady as a key factor, emphasizing that any cuts would be gradual and data-dependent.

This stability in mortgage rates is closely tied to the broader economic environment. Inflation, which peaked at over 9% in 2022, has cooled to around 3% in recent months, according to the Bureau of Labor Statistics. Experts like Mark Thompson, a senior analyst at Zillow, argue that this cooling trend reduces the pressure on the Fed to hike rates further. "Inflation is under control, but not defeated," Thompson explained in a recent webinar. "The Fed will likely maintain a neutral stance, which translates to mortgage rates staying put. For homebuyers, this means affordability won't improve dramatically, but it also won't worsen."

On the home price front, the status quo prediction is equally compelling. Median home prices across the U.S. have stabilized at approximately $400,000, with year-over-year growth slowing to just 2-3%. Experts attribute this to a balanced supply-demand equation. Inventory levels, which were critically low during the pandemic-induced buying frenzy, have begun to rebound modestly. "We're seeing more homes on the market, but not a flood," noted Sarah Jenkins, a housing market researcher at Redfin. "Builders are ramping up construction in response to demand, but labor shortages and material costs are keeping supply growth in check."

Regional variations add nuance to this national picture. In high-demand areas like California and New York, prices may inch up slightly due to persistent population influxes and limited land availability. For instance, in Southern California, where the median home price exceeds $800,000, experts predict a modest 1-2% increase, driven by tech industry growth and remote work trends. Conversely, in the Midwest and parts of the South, where affordability is higher, prices could remain flat or even dip marginally if economic slowdowns affect local job markets.

The implications of this status quo are multifaceted. For first-time buyers, stable rates and prices mean that entering the market remains challenging but feasible with careful planning. "Buyers should focus on improving credit scores and saving for down payments," advised financial advisor Lisa Chen. "With rates not expected to plummet, locking in now could be wiser than waiting for an uncertain future drop." Sellers, on the other hand, might find the market less frenzied than in previous years, requiring more competitive pricing and staging to attract offers.

Experts also highlight external factors that could influence this outlook. Geopolitical tensions, such as ongoing conflicts in Europe and the Middle East, could indirectly affect oil prices and, by extension, inflation and interest rates. Domestically, the 2024 presidential election's aftermath plays a role; policies on housing subsidies, tax incentives, and zoning reforms could either reinforce or disrupt the status quo. "If we see aggressive pro-housing legislation, it might increase supply and pressure prices downward," said Dr. Ramirez. "But based on current trajectories, that's not imminent."

Looking deeper into the data, the Mortgage Bankers Association (MBA) echoes these sentiments in its latest forecast. The MBA projects that mortgage originations will total around $2 trillion in 2025, a slight uptick from 2024, driven by refinancing activity if rates dip even marginally. "Refinancing could pick up if rates fall below 6%, but we're not banking on that," stated MBA economist Joel Kan. This cautious optimism is tempered by concerns over household debt levels, which remain elevated post-pandemic.

Consumer sentiment, as measured by the University of Michigan's index, has shown improvement, rising to 70 in recent months from lows in the 50s. This uptick suggests that Americans are feeling more confident about major purchases like homes, which could sustain demand without overheating the market. "People are adapting to higher rates," Jenkins from Redfin observed. "The 'lock-in effect'—where homeowners with low-rate mortgages from 2020-2021 are reluctant to sell—is easing as life circumstances change."

Critics of the status quo prediction argue that underlying issues, such as affordability crises in urban centers, could lead to more volatility. "Stable doesn't mean accessible," countered affordable housing advocate Maria Gonzalez. "For low-income families, flat prices and rates still mean exclusion from homeownership." Gonzalez points to data showing that Black and Hispanic homeownership rates lag behind the national average, exacerbated by stagnant wages and rising living costs.

Despite these concerns, the prevailing expert view leans toward equilibrium. In a panel discussion hosted by the Urban Land Institute, participants from various sectors—banking, real estate, and academia—concurred that 2025 will be a year of consolidation rather than transformation. "The housing market has weathered storms before," said panelist Dr. Thomas Hale, a professor of economics at Stanford. "With no major shocks on the horizon, expect more of the same."

For investors, this stability presents opportunities in rental properties and real estate investment trusts (REITs), where yields could remain attractive without the risks of price swings. "Diversification is key," advised investment strategist Robert Kline. "Focus on markets with strong rental demand, like college towns and growing suburbs."

As we move into 2025, the message from economists is clear: don't expect fireworks in the housing sector. Mortgage rates and home prices are poised to hold steady, offering a predictable environment for decision-making. While this may disappoint those hoping for a market correction, it underscores the resilience of the U.S. economy. Homebuyers and sellers would do well to stay informed, consult professionals, and act based on personal financial readiness rather than speculative forecasts.

In summary, the status quo isn't stagnation—it's a foundation for sustainable growth. As Dr. Ramirez aptly put it, "Stability breeds confidence, and confidence drives the market forward." Whether this prediction holds true will depend on a myriad of factors, but for now, the experts are betting on more of the same. (Word count: 1,028)

Read the Full Los Angeles Daily News Article at:
[ https://www.dailynews.com/2025/07/31/economists-experts-say-status-quo-for-mortgage-rates-home-prices/ ]