Zillow just updated its 2025 housing market forecast, and the changes deserve attention, especially if you’re actively investing in real estate.
📉 Home Values Likely to Dip
Zillow now expects home values to fall by 1.9% in 2025, reversing its earlier forecast of a 0.6% increase. The change stems from a growing number of listings hitting the market. More inventory means buyers have more options, and that’s easing the pressure on prices.
🏡 Buyers Are Back in the Market
Despite the dip in home values, Zillow forecasts 4.3 million existing home sales in 2025, up from 4.1 million last year. Buyers seem more willing to jump in as more homes become available.
📊 Mortgage Rates Still Shifting
Mortgage rates continue to move unpredictably, but Zillow believes they’ll settle around 6.5% by year-end. For investors planning ahead, that kind of rate stability makes it easier to forecast financing costs.
🏠 Rents Keep Climbing
Zillow also expects continued strength in the rental market:
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Single-family rents may rise by 3.6%
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Multifamily rents may grow by 2.5%
Demand for rentals remains strong, especially as many buyers struggle with affordability.
🧭 What Investors Should Consider
Falling prices and rising rents may create opportunities for well-prepared investors. However, each local market tells a different story. Some cities and states may see sharper changes, while others stay steady or even outperform.
🔍 Check how your market stacks up using Zillow’s full forecast:
👉 Zillow’s Housing Forecast Page
If you want to unpack what this data means for your portfolio or upcoming investments, reach out. At Nexus Square, we help real estate investors navigate market shifts with clarity and confidence.
