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s the spring selling season gets underway, real estate agent Thai Hung Nguyen is cautiously optimistic about the market in the metro Washington D.C. area. With a significant portion of residents employed by or contracting with the federal government, any changes in the job market can have a ripple effect on the housing market. So far, there are slightly more listings coming on the market than at this time last year, but not enough to suggest a mass exodus from the area.
Nguyen's experience reflects the national housing market, where buyers and sellers are entering the traditionally busiest season of the year with mixed expectations. While moderating interest rates may be welcome news, tariffs, inflation, and consumer fears about jobs and the economy could keep the market stagnant.
According to Selma Hepp, chief economist at Cotality, home sales in 2025 are expected to be "slightly above" last year's pace, which was the lowest level in three decades. The current trend shows a gradual increase in sales, with more inventory available and buyers gaining leverage through negotiations and discounting.
Data from Realtor.com confirms this trend, with inventory up 29.2% compared to last year and prices remaining flat or slightly lower annually. Mortgage rates have also decreased, making monthly payments more manageable for buyers – as long as they remain employed and confident.
However, the new-construction market is facing a different challenge. With high inventory levels, builders may need to offer price cuts to clear their inventories, which could become increasingly difficult if tariffs raise building costs. Analysts are concerned about buyer confidence, citing growing consumer concerns about the economy and affordability challenges in a "higher for longer" rate environment.
Despite these concerns, Nguyen believes consumers are more adaptable than some experts realize, and that mortgage rates are now seen as manageable by many buyers, with people being comfortable with rates in the sixes.
