📊 Mortgage Rate Predictions for 2025: A Data Analyst’s Perspective

The wide range of mortgage rate predictions for 2025 highlights the uncertainty in the housing market. Here’s a breakdown of some forecasts, courtesy of Dave at MortgageNuggets.com:

🔹 Redfin: 6.80%
🔹 Capital Economics: 6.75%
🔹 Hunter Housing: 6.60%
🔹 CoreLogic: 6.50%
🔹 Wells Fargo: 6.41%
🔹 MBA: 6.40%
🔹 Fannie Mae: 6.30%
🔹 Moody’s: 6.30%
🔹 Morgan Stanley: 6.25%
🔹 BrightMLS: 6.25%
🔹 Realtor.com: 6.20%
🔹 NAHB: 6.12%
🔹 Goldman Sachs: 6.10%
🔹 NAR: 5.80%

While these forecasts provide valuable insights, it’s difficult to critique the soundness of each without understanding the underlying data and assumptions. What is clear, however, is that mortgage rates will continue to impact home sales in the immediate future.

But it’s not just about rates. Even as rates have dropped almost 1.5% since the October 2023 peak, home sales remain stagnant. For example, take a look at the sales data from Maricopa County (Phoenix market):

📉 Annual Sales in Maricopa County

  • 2010: 79,126
  • 2015: 74,717
  • 2020: 89,235
  • 2021: 92,436
  • 2022: 69,969
  • 2023: 58,380
  • 2024 (YTD): 48,833

Despite the recent dip in rates, 2024 is shaping up to be the worst year for home sales in two decades. The stagnation reflects more than just homeowners with low-interest rates unwilling to sell; broader financial conditions and buyer hesitancy are playing a significant role.

This is why predictions of a “hot market” in 2025—like those from NAR—seem overly optimistic, if not outright unrealistic. Given NAR’s legal and ethical issues, it’s hard to take their projections seriously.

For now, the data suggests a long road to recovery, with significant challenges for buyers, sellers, and the housing market overall.

🔗 Want to explore these trends in more detail? Let’s connect and discuss how data can help make sense of the shifting real estate landscape.

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