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US home prices are projected to rise an average of 2.5% in 2025, according to Resiclub’s analysis of the top housing forecasters. Here’s a breakdown of what each forecaster expects:
- Goldman Sachs: 4.4%
- Wells Fargo: 4.3%
- Mortgage Bankers Association: 3.3%
- Morgan Stanley: 3.0%
- Zelman & Associates: 2.3%
- Fannie Mae: 1.5%
- Freddie Mac: 0.5%
- Moody’s: 0.3%
Our take
We might not be as bullish as Goldman or Wells Fargo, but we are bullish. We don’t expect a dramatic crash in housing prices. Instead, we believe prices will grow at a slow and steady rate this year and next. Already, year-to-date, US home prices are up 3.1% through April as measured by Case-Shiller. But it’s not all rosy. Since mortgage rates will likely stay higher for longer, affordability will continue to be an issue. Even though buyers are getting more aggressive with all-cash deals, we think deal volume and overall home sales will be down this year and next.