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Daily Mail
24-05-2025
- Business
- Daily Mail
Real estate experts make U-turn on 2025 housing prediction
Predictions that home prices would keep climbing in 2025 may have missed the mark — badly. Real estate experts now say the out-of-whack home prices in many parts of the US are expected to drop — and it'll be the first time since 2011. Zillow economists delivered a 12-month forecast that projects that US home prices on average will fall by 0.9 percent between April 2025 and April 2026. It's a strong reversal from Zillow's predictions earlier this year, which had home values climbing by 2.9 percent. It means the pandemic era property boom leveling out. A rise in listings is fueling and end to price growth, as greater supply provides more options and more bargaining power for buyers , Zillow said in a March report. It means the pandemic era property boom leveling out. The crippling affordability crisis eventually had to lead to a price drop, the real estate company said. During the pandemic, low interest rates and a homebuying frenzy sent prices sky high. But now, with mortgage rates more than doubling from 3 percent-lows, many potential buyers are simply priced out . The average monthly mortgage payment in the US is now a whopping 35.3 percent of the median household income. Some people believe homeownership is a burden. 'Affordability is still challenging buyers… A 20 percent down payment now comes out to around $72,000 on the average home. That's a steep entry fee,' said Zillow's chief economist, Skylar Olsen (pictured). Among the metros that Zillow predicts will see big price falls from spring 2025 to spring 2026 are Greenville, MS, where prices will decrease 16.2 percent, and Cleveland, MS, where prices are set to decline 12.5 percent. Raymondville, TX, is forecast to see prices drop 12.1 percent. The once-hot housing market in Florida will also see home prices drop even further . The state has taken a massive hit to its housing market, with a surplus of inventory flooding the market, soaring insurance premiums to cover natural disasters, and massive HOA fees. Louisiana will also see home values drop in various metros, according to Zillow. Houma, for example, is due to see its home prices drop 10.2 percent, while Lake Charles, will see prices decline 8.4 percent. Other areas in the state where home values are predicted to fall between 5 and 7.5 percent include Alexandria, New Orleans, Monroe, Lafayette, and Shreveport. Kingston, NY, will see home values go up by 2.6 percent and Torrington, CT, will see values rise 2.4 percent, it predicts. In Knoxville, TN, home values will rise by 2.3 percent, and values will grow by 2.2 percent in Rochester, NY.
Daily Mail
23-05-2025
- Business
- Daily Mail
Real estate experts make stunning U-turn on 2025 housing prediction
Predictions that home prices would keep climbing in 2025 may have missed the mark — badly. Real estate experts now say the out-of-whack home prices in many parts of the US are expected to drop — and it'll be the first time since 2011. Zillow economists delivered a 12-month forecast that projects that US home prices on average will fall by 0.9 percent between April 2025 and April 2026. It's a strong reversal from Zillow's predictions earlier this year, which had home values climbing by 2.9 percent. It means the pandemic era property boom leveling out. A rise in listings is fueling and end to price growth, as greater supply provides more options and more bargaining power for buyers, Zillow said in a March report. It means the pandemic era property boom leveling out. The crippling affordability crisis eventually had to lead to a price drop, the real estate company said. During the pandemic, low interest rates and a homebuying frenzy sent prices sky high. But now, with mortgage rates more than doubling from 3 percent-lows, many potential buyers are simply priced out. The average monthly mortgage payment in the US is now a whopping 35.3 percent of the median household income. Some people believe homeownership is a burden. 'Affordability is still challenging buyers… A 20 percent down payment now comes out to around $72,000 on the average home. That's a steep entry fee,' said Zillow's chief economist, Skylar Olsen. Among the metros which Zillow predicts will see big price falls from spring 2025 to spring 2026 are Greenville, MS, where prices will decrease 16.2 percent, and Cleveland, MS, where prices are set to decline 12.5 percent. Raymondville, TX, is forecast to see prices drop 12.1 percent. The once-hot housing market in Florida will also see home prices drop even further. The state has taken a massive hit to its housing market, with a surplus of inventory flooding the market, soaring insurance premiums to cover natural disasters, and massive HOA fees. Louisiana will also see home values drop in various metros, according to Zillow. Houma, for example, is due to see its home prices drop 10.2 percent, while Lake Charles, will see prices decline 8.4 percent. PIC OF GREENVILLE, MS, OR CLEVELAND, MS XXX Other areas in the state where home values are predicted to fall between 5 and 7.5 percent include Alexandria, New Orleans, Monroe, Lafayette, and Shreveport. Texas will also see property prices decline - particularly in Beaumont, Midland and Odessa. Zillow expects the strongest home price appreciation between April 2025 and April 2026, meanwhile, to happen in Atlantic City, NJ, at 3.2 percent. Kingston, NY, will see home values go up by 2.6 percent and Torrington, CT, will see values rise 2.4 percent, it predicts. In Knoxville, TN, home values will rise by 2.3 percent, and values will grow by 2.2 percent in Rochester, NY. Zillow's housing verdict concludes that the pandemic housing market will finally cool. This is good news for buyers, who will finally have the upper hand in the coming year.
Miami Herald
08-05-2025
- Business
- Miami Herald
Zillow forecasts San Diego home values to drop for the first time in years
Zillow has broken from the pack to say San Diego County home values could decrease over the next year. Home values in San Diego County will drop 1.1% by March 2026, Zillow said in its latest Home Value Index. While the decrease is small, it's notable because no other major forecasters have said home prices, or values, would drop, and it's been two years since the Seattle-based housing website's forecast turned negative. Zillow forecasts national home values will drop by 1.7% in a year. San Diego's dip was on the lower end of decreases for big metropolitan areas. San Francisco Bay Area home values were forecast to drop 5.2%; Minneapolis, down 4.2%; Denver, down 4.1%; and Houston, down 3.1%. The forecast is a bit different than a straight home price prediction. Zillow goes beyond median sale prices to calculate the value of a typical home in a given region, using the average middle third of home values (eliminating statistical anomalies at the high and low end). It said the average home value in San Diego County in late March, across all housing types, was $953,831, up 2.3% in a year. As of last month's report, Zillow was still predicting home values would increase nationwide, 0.8%, and 1.7% in San Diego County. So, what happened from February to March? Zillow says the number of homes greatly increased, which reduces competition and avoids bidding wars, and affordability metrics tumbled. "Home price growth paused and inventory swelled during what is typically one of the most competitive home shopping months of the year," wrote Skylar Olsen, Zillow chief economist, in the March report. There were 5,276 homes for sale in San Diego County over the past four weeks, according to Multiple Listing Service data analyzed by the Redfin Data Center. That's up 26% from the same time last year, and near the high point of the past four years of nearly 6,000 in summer 2022. Part of the reason for increased inventory is homes are sitting longer on the market: The median days to close was 25 days at the end of April, down from 22.5 in February. Olsen noted lower mortgage rates in March, and significantly more homes for sale, did not increase sales - a sign that affordability was a significant issue. Average mortgage rates in March, Zillow said, were 6.65% compared to 6.82% a year before. Similar to San Diego County, inventory was up 19% nationwide. "Affordability is still challenging buyers," she wrote. "A mortgage payment on a typical home in March required about 35.3% of median household income nationwide when using a 20% down payment. That's a slight improvement over last year, but is still unaffordable." Most home price forecasts are not as current. JP Morgan Research said in February it predicted house prices will rise 3% this year, and 13 out of 14 members of The San Diego Union-Tribune's Econometer panel in December (made up of business leaders and economists) forecasted rising prices for 2025. The most recent forecast besides Zillow came from Fannie Mae in March, where it predicted nationwide home prices to rise 4.1% in 2025 and 2% in 2026. Its forecast was largely based on its belief mortgage rates would end the year at 6.2% and prompt more buyers to test out the market. Copyright (C) 2025, Tribune Content Agency, LLC. Portions copyrighted by the respective providers.
Epoch Times
08-05-2025
- Business
- Epoch Times
Rent or Buy a Home? Californians Increasingly Have No Choice
California is home to some of the widest gaps between mortgage payments and rental costs in the nation, meaning it is increasingly harder to buy a home compared to renting one, according to analysts. The California Legislative Analyst's Office (LAO) 'Historically, people would rent, save money, and then buy a house. But, if the rents are high and the prices of houses are even higher, then there's really no hope,' Joel Kotkin, a fellow in urban studies at Chapman University, told The Epoch Times. 'Buying is becoming more and more difficult, unless you have inherited wealth, or if you have money from overseas.' A Bankrate compared average monthly rent to average monthly mortgage payments across the 50 largest U.S. metropolitan areas, and revealed that cities in California are at the top of the list when it comes to expensive home ownership, especially when compared to rents. San Francisco has a buy-rent gap of 190.7 percent, making it home to the largest gap nationwide. The typical monthly mortgage payment in San Francisco was around $8,882, up 4.7 percent year-over-year, while the typical rent is $3,055, down 1.7 percent year-over-year. Related Stories 4/23/2025 4/23/2025 San Jose comes in a close second on the list, where homeowners fork over mortgage payments that are 185.6 percent higher than rent. The typical mortgage payment is $9,438, up 10.5 percent year-over-year, with rent coming in around $3,305, down 1.3 percent year-over-year. Los Angeles and San Diego have seen a similar trend. Mortgage payments in Southern California's largest metro areas are 88.5 percent and 79.9 percent higher than rent, respectively, landing them sixth and ninth compared to other U.S. metros included in the study. Bankrate's study attributes high cost gaps between renting and owning a home to skyrocketing home prices because of low housing supply, as well as high mortgage rates, which ' If you're in the coastal markets, you have to consider this home as a very long-run solution,' Skylar Olsen, Zillow's chief housing economist, said in a statement. 'In California, people famously leave their homes to their children. There are very long tenures in these really expensive markets for that reason.' California Housing Costs California homes are around twice as expensive as the typical American home, reported the California LAO, citing Zillow data. A mid-tier home in California costs around $789,000 in 2025, compared to the U.S. average of $361,000. According to the California Association of Realtors (CAR), the median California home price in March 2025 was In a July 2024 report from Los Angeles's median home price is just over Mid-tier home monthly payments reached nearly $5,900 a month in March 2024, making for an 82 percent growth in prices since January 2020, reported the California LAO. Bottom-tier home payments reached more than $3,500 per month, representing an 87 percent increase since January 2020. CAR reports that a mere 17 percent of households could Homeownership rates have fallen in California, according to U.S. Census Bureau data, where the current home ownership rate is Meanwhile, according to the LAO, the monthly The California Housing Partnership The Public Policy Institute of California (PPIC) Lack of Homeownership Amid the rising prices, 70 percent of Californians believe children today will fare worse than their parents financially, according to a 2024 PPIC statewide The survey found 29 percent of Californians skipped meals or ate less food in order to save money within the prior year, while 17 percent used CalFresh (food stamp) benefits. Moreover, 20 percent put medical care on hold as a result of financial constraints. According to Mark Schniepp, director of The Economic Forecast, the main issue is housing. 'But there's not much we can do about it outside of building more of it,' Schniepp told The Epoch Times in an email. 'However we are unlikely to be able to build enough, given current regulations in place and current zoning.' 'The Coastal Act, CEQA, land costs and many local regulations prevent developing housing,' he added. Kotkin agreed state policies have contributed to a lack of affordable housing, which makes it difficult to build in places that would otherwise be cheaper. 'What essentially is approved is increasingly high density and expensive in the inner city,' Kotkin said. The bottom line, he said, is that home ownership is an important part of preparing for retirement. If you own a house, then you can stay there once you retire, because you probably have paid it off. 'The house is an asset,' he said. '[Owners] can borrow against it, they can sell, and then they can have a comfortable retirement.' However, if an increasing number of people are forced to rent, 'people will generally look to the state, or some other institution, to take care of them, because they have nothing of their own,' Kotkin said. 'They're going to rent for life, which means that when they retire, they're not going to have any assets. They're going to be dependent on state transfer payments.' He sees such dependency as incompatible with democracy. 'Democracy is built on the fact that there's some degree of independence on the part of a large part of the population,' he said. 'If you own a house, you have a certain degree of autonomy that maybe you can think in a different way than if you are dependent on the fact that your landlord may decide to increase the rent 50 percent.'
Yahoo
18-04-2025
- Business
- Yahoo
Sellers are putting more homes on the market. But it's proving difficult to find buyers.
Sellers put up considerably more houses than were bought last month, Zillow found. This resulted in a housing inventory increase of 9% year-over-year. Buyers are still being held back by affordability challenges even as more homes come available. The housing market saw a pronounced buyer-seller mismatch last month, and it's proving difficult to draw prospective home buyers off of the sidelines, according to Zillow. That could spell good news on the housing-affordability front. Buyers holding back from buying a home due to cost concerns could eventually prompt price cuts, and just in time for one of the hottest home-buying seasons of the year. Sellers put more than 375,000 homes on the market last month, a 32% increase from last month and a 9% increase compared to levels recorded the same month last year, according to a report Zillow released on Monday. But buyers haven't been keeping pace with the growth in new listings. Pending home sales for the month remained flat compared to last year's levels, with just 265,000 listings transitioning into a pending sale in March. That means the housing market added a net 110,000 listings last month, pushing overall inventory up 19% year-over-year to 1.15 million, Zillow estimated. That's the most inventory the market has seen since March 2020, when the pandemic pushed the housing market into a near-standstill, according to Skylar Olsen, the chief economist at Zillow. "Home price growth paused and inventory swelled during what is typically one of the most competitive home shopping months of the year. That's despite mortgage rates reaching a 2025 low in March," Olsen wrote in the note. "While sellers leaned on the gas, buyers didn't keep up," she added. This embedded content is not available in your region. Olsen said buyers may have been held back by affordability concerns, with high home prices keeping mortgage payments elevated. The typical mortgage payment, assuming a 20% down payment on a home, cost around 25% of the median US household income in March, Zillow estimated, outside the recommended guideline to keep housing costs under 30% of one's total income. Sellers have already started to give in to pressure to slash home prices. with 23% of listings on Zillow seeing a price reduction over March. That's the largest share of homes with a price cut since 2018, and up slightly from last month's share, when 21% of homes on Zillow had a price cut, the firm said. That said, the housing market has been tipped towards sellers' favor for most of the last five years. Zillow's Market Heat Index, which shows whether the housing market is more favorable to buyers or sellers, moved from "neutral" territory to "sellers market" territory in March, the first time it's done so since June of last year. Read the original article on Business Insider Sign in to access your portfolio
