Mortgage Rate Outlook: Is it a Buyer’s Market Yet?

Regarding the direction of U.S. economic policies, and the impact those policies will have on our economy, it's still anybody's guess. Meanwhile, the U.S. housing market seems to be navigating its own path, shaped by elevated mortgage rates, tight supply, and evolving buyer preferences.

Home price increases have slowed, and we’re starting to see longer days-on-market coupled with price cuts on homes that were priced too high by overly optimistic sellers. While it may yet be a bit early to declare a buyer’s market, it’s certainly becoming more balanced!

Mortgage Rates – More Like This
Rates are likely to stay elevated for the rest of the year. The jobs picture is slowing, but the overall labor market is still tight, and the Fed has emphasized that they need more clarity on the impact of inflation, government policy, and global trade before bringing the Fed Funds Rate down. Most economists are now projecting two rate cuts later in the year, if the job market weakens further this summer.

Keep an eye on the 10-year bond rate, which mortgage rates generally move in tandem with. While the Fed may have control over the short end of the rate curve, the global bond market’s appetite for U.S. debt will control mortgage rates.

And we’ve seen some reason for concern here. “Mortgage borrowing costs could decline in 2025 but not by much. Rates in the 6% to 7% range are likely to be the new normal for mortgage costs for the foreseeable future,” wrote Russell Price, Chief Economist at Ameriprise Financial.

Home Prices Should Continue Up — Slowly
According to the National Association of Realtors Chief Economist Lawrence Yun, U.S. home prices should rise by 3% in 2025. While not the meteoric rise we’ve seen recently, if you’re waiting for a crash, you might be disappointed. Despite this year’s slow start, existing-home sales volume is still expected to grow by 6%.

Buyer Preferences – Shifting
Buyers today seem to be prioritizing features such as remodeled areas, updated flooring, updated appliances, outdoor cooking, climate resiliency, and solar panels with whole-home batteries.

Virtual reality tours have transformed home shopping; 95% of buyers search for homes online and 77% ask for virtual tours.

If your home feels like it needs a refresh, let’s talk about tapping built-up equity to get your home up to date! And, if a move is in your future, let’s get ahead of the curve and get the right financing plans in place. It’s never too early to start the process, so that you’re ready to pounce when the time is right!


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