Wondering what’s in store for the housing market this year? And more specifically, what it all means for you if you plan to buy or sell a home?  Experts are constantly updating and revising their forecasts, so here’s the latest on two of the biggest factors expected to shape the year ahead: mortgage rates and home prices.

Will Mortgage Rates Come Down?

Everyone’s keeping an eye on mortgage rates and waiting for them to come down. So, the question is really: how far and how fast? While rates are expected to ease a bit in 2025, don’t expect to see a return of 3-4% mortgage rates. As Lawrence Yun, Chief Economist at the Nation al Association of Realtors (NAR), says: “Are we going to go back to 4%? It’s more likely that we’ll go back to 6%.” Most other experts agree. They’re forecasting rates could settle in the mid-to-low 6% range by the end of the year. This will continue to change as new information becomes available. Expert forecasts are based on what they know right now. And since everything from inflation to economic drivers have an impact on rates, some ups and downs are still very likely. Instead of focusing on the exact rate at the time, focus on the overall trend and on what you can actually control. We have trusted lenders with excellent loan programs that can lessen the impact of your mortgage payment in the short term. Many of these lenders are also offering a free refinancing within three to five years. With their help, the home you are seeking may still be affordable even if rates do not get back below 4%.

Will Home Prices Fall?

While mortgage rates are expected to ease, home prices are projected to keep climbing in most DC metro areas-just at a slower, more normal pace. Expert forecasts are for prices to go up roughly 3% next year, with most of the experts hitting somewhere in the 3 to 4% range. That’s a much more typical and sustainable rise in prices. We have run across many buyers reading national articles about potential price drops and expecting that to apply to the DC metro area with our robust economy, private sector jobs, and floor provided by government jobs. The expectation in the DC area is for prices to rise generally, and with inventory so tight, the best homes still seeing multiple offers and big price increases. Those expecting a sudden drop in prices that will score them a big deal will be sorely disappointed. Home prices come down to supply and demand. Even though there are more homes for sale now than there were a year ago, it’s still not enough to keep up with all the buyers out there. If you want to learn more about what is happening in your local neighborhood, or neighborhoods you are considering for purchase, give us a call and we will be happy to sit down and walk you through the most recent statistics on these areas.