Where home prices are expected to go in 2025, predicted by real estate data giant

Want more housing market stories from Lance Lambert’s ResiClub in your inbox? Subscribe to the ResiClub newsletter. Despite several factors that can hurt housing affordability like elevated mortgage rates, steep home insurance premium hikes, and property tax increases, national home price appreciation remained relatively strong in 2024. Through the month of October, U.S. home prices as measured by the CoreLogic Home Price Index are up 3.4% year over year. As we approach the prime season for housing activity, experts are gauging how home price appreciation in 2025 will compare to 2024. “This year’s housing market saw pretty strong home price appreciation, averaging over 4%,” says Selma Hepp, chief economist of the real estate data giant CoreLogic. “However, 2025 is expected to see a slowdown in price growth.” Economists at CoreLogic just published their latest national home price growth forecast, predicting that U.S. home prices will rise 2.4% over the next 12 months. That’s still positive growth but it’s decelerated from the current rate of appreciation. “We did start off the year with higher expectations (for price growth) for 2025—now we have lower expectations,” Hepp told ResiClub. “It’s a function of higher mortgage rates and inventory levels going up. Rising inventories stall the rate of home price appreciation.” CoreLogic’s forecast is based on the idea of a "long-term reversion to the mean," where home prices eventually return to long-term average growth. However, factors like elevated mortgage rates and income growth disparities impact momentum.  “When considering home price appreciation, it’s important to remember where prices were last year, especially during the spring homebuying season. There was a significant amount of appreciation during that time,” Hepp says. “On a year-over-year basis, the spring homebuying season is expected to see almost flat growth, before picking up again later in the year, with appreciation in the range of 1% to 2%.” Hepp doubts there will be a significant pickup in sales transactions in 2025, but she does believe there could be more activity in 2026 if a drop in rates stimulates homebuying demand. What do other forecasts think? Among the 16 forecasts currently tracked by ResiClub, the average prediction is a 3.5% increase in U.S. home prices in 2025.