Housing Market Projected to Stay Cool for the Near Future
High home prices, mortgage rates, and property taxes, among other factors, are tamping down housing market activity
Feb. 19, 2025
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Activity in the housing market is likely to remain cool over the next several months.
The housing market is expected to remain cool for the near future, largetly due to high home prices, elevated mortgage rates, and rising property taxes. According to National Mortgage Professional, home prices have risen about 55% since before the pandemic, but their growth has slowed to the weakest pace seen since mid-2023 due to high mortgage rates and increasing housing inventory. Property taxes are also influencing homebuyer decisions, with data showing property taxes have risen 15.4% since before the pandemic.
“Elevated mortgage rates reduce house-buying power for potential buyers, holding back demand,” explains First American Chief Economist Mark Fleming. “At the same time, inventory levels are increasing as some potential sellers list their homes for sale after coming to terms with ‘higher-for-longer’ rates and more new-home completions hit the market, further dampening price growth.”Read more
