Homebuilder and Mortgage Broker Optimism Signal Market Growth in 2025 with Prices and Trends
Mortgage rates have dropped below 7%, sparking renewed confidence among homebuilders and mortgage brokers. Forecasts predict a 6% rise in existing home sales and a 10% increase in new home sales in 2025, pointing to a stronger housing market ahead.
Highlights
- Recent decline in mortgage rates has fueled positive market outlooks for 2024.
- The NAHB/Wells Fargo Housing Market Index rose to 37 in December, marking the first increase in four months.
- The Mortgage Bankers Association projects a 6% growth in existing home sales and a 10% surge in new home sales next year.
Mortgage rates have significantly eased from their late-October peaks, dropping below 7% for the first time since August. This shift, coupled with the Federal Reserve's indication that interest rates will remain steady, has brightened prospects for prospective homebuyers and builders alike.
The National Association of Home Builders (NAHB) reported an uptick in builder confidence, with the Housing Market Index climbing three points to 37 in December, surpassing economists' expectations. NAHB Chairman Alicia Huey noted increased buyer interest as mortgage rates decline, encouraging those previously priced out to reconsider entering the market.
Supporting this optimism, the Mortgage Bankers Association forecasts a substantial 17% rise in mortgage loan originations in 2024, alongside notable increases in both existing and new home sales. These trends indicate a rejuvenated housing sector poised for growth in the year ahead.
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