Will the 2025 Real Estate Market Go Up in Flames?

As election season wraps up, the question on everyone’s mind is: will the real estate market finally gain some traction? With political uncertainty fading, both buyers and sellers may feel a renewed sense of stability. But does that mean a booming market and lower interest rates are on the horizon? Not quite.

A Shift to Normalcy in the Market

Over the past several months, the real estate market has slowed significantly, largely due to higher interest rates and pre-election apprehensions. Homes that would’ve sold within days during the frenzy of the last few years are now spending weeks or even months on the market. For instance:

• Gainesville: Average days on market (DOM) have increased to 32, up 88% from last year.
• Cumming: Current DOM is 19, a 72% jump compared to 2023.
• Suwanee: Homes are averaging 11 days on market, a 22% rise year-over-year.

This more balanced pace allows buyers to negotiate better deals, such as price reductions, closing cost assistance, and repair concessions—luxuries that were nearly impossible just a few years ago.

Interest Rates: The New Normal

Despite hopes for significant decreases, mortgage rates have remained in the low 7% range. Factors like deficit spending concerns and weakened demand for government bonds have kept rates elevated. While incremental declines may occur, don’t expect drastic drops. Buyers and sellers are coming to terms with this new normal, and experts predict rates in the 6-7% range are here to stay for the foreseeable future.

Pricing Trends: Rising Costs Outpace Waiting Game

For those who’ve been waiting for prices to drop, the reality may be disappointing. Over the past few years, home prices have continued to rise, even in a cooling market:

• Atlanta Metro Area: The average sales price increased from $435,000 in October 2021 to $515,000 in October 2024.
• Alpharetta: Prices surged from $583,000 in 2021 to $780,000 in 2024.

This trend highlights that waiting for a market downturn could result in missed opportunities and being priced out of desired areas.

Why Buying Now Could Be Wise

If you’re renting while waiting for “the right time,” it might be worth reconsidering. Rental costs provide no long-term financial benefit, while home prices and interest rates are unlikely to drop significantly. Historically, assets like real estate have continued to appreciate, and today’s buyers may benefit from negotiating more favorable terms.

KeyPoint

The 2025 real estate market is unlikely to see dramatic changes but will reflect a return to more traditional trends. A stable yet growing market means buying sooner rather than later could be a smart move. While no one can predict the future with certainty, historical data suggests waiting could cost you more in the long run.

Thinking of making a move? The key is to act strategically and work with a knowledgeable local expert to navigate the current market.