R
eal estate experts predict a slight reprieve for homebuyers in 2025 as inventory levels increase marginally, but demand for single-family homes remains strong. In Massachusetts, the total number of single-family homes sold through November 2024 reached 34,784, a 1.6% rise from the previous year's historically low sales. However, last year's statewide median sales price was $616,925, an 8.2% increase.

    Mortgage rates declined in the fall but have since risen to around 7%. Nicole Rideout Hartwick, president of Gibson Sotheby’s International Realty, expects a busy spring market due to pent-up demand from buyers who were sidelined by the election and interest rate uncertainty. She predicts that new construction will struggle to keep up with demand.

    Realtor Stewart Young agrees that there's a lack of new construction despite strong demand. He notes that all markets, including luxury homes, new construction, smaller homes, and condominiums, are on the rise. Young expects these trends to continue, particularly in high-end inventories and sales.

    Buyers are seeking turnkey properties with minimal cosmetic upgrades but also see opportunities in fixer-uppers. They prioritize good schools, access to amenities, and reasonable commuting. Suburban markets have been extremely competitive, with record sales prices, and there's a preference for town or village center locations over rural areas.

    The Boston market has remained steady and healthy, according to Hartwick. She predicts interest rates will become more favorable in 2025, dropping to high 5% and low 6% by the end of the year. However, Young is more cautious, citing factors like the new administration that may impact interest rates.

    Kim Williams, a Realtor with Gibson Sotheby's International Realty, notes that low housing inventory remains the biggest obstacle for buyers, especially first-timers. Experts agree that despite improvement, sellers will maintain an advantage due to ongoing demand and limited supply.

    Hartwick expects the Greater Boston housing market to be steady and competitive across all markets and price ranges in 2025. Young adds that climate change-related risks, such as sea level rise and storm surge, are increasing concerns for real estate owners and buyers, particularly in high-risk areas.