F
annie Mae economists have reduced their forecast for home price growth in 2025, citing the uncertainty surrounding the US economy and mortgage rates hovering around 7%. This has led some analysts to predict that prices could actually fall. The Fannie Mae expert panel now estimates a national home price growth of 3.4% in 2025, down from 3.8% previously forecasted and significantly lower than last year's average growth rate of 5.8%.

    Home price growth has been sluggish so far this spring, with the median pending home sale price increasing by just 2.5% compared to a year ago, according to Altos Research founder Mike Simonsen. He notes that prices are "staying just barely positive" and wonders if economic turmoil could lead to negative price growth or notable declines.

    While some local markets have seen declines in home prices, the national trend remains positive. However, 42 of the largest metro areas saw year-over-year price drops in February, with Florida being particularly hard hit, accounting for 20 of those metros. The Northeast continues to see above-average price growth, with cities like Rochester, New York, experiencing 7.5% year-over-year growth.

    New listings remain strong, up 10.3% year-over-year in early April, according to Redfin. Researchers suggest that sellers may be trying to cash in on their equity before a potential economic downturn. Despite the uncertainty, many homeowners remain optimistic about selling their homes, with 81% of those considering listing expecting to get at or above their asking price.