Additionally, MBA’s updated forecast projects slightly lower home sales in 2025, with existing homes selling at a seasonally adjusted annual rate of 4.25 million, as opposed to the October forecast, which projected 4.3 million. The change in projection for new homes sales in the updated forecast is negligible.
HousingWire’s 2025 housing market forecast projects 4.2 million existing home sales, as does Goldman Sachs’s. Of the forecasts HousingWire analyzed, the National Association of Realtors has the highest projection at 4.9 million.
MBA isn’t the only forecast revising home sales downward. Fannie Mae dropped its expectations for home sales growth in 2025 from 11% to 4%.
After a summer in which both the 15-year and 30-year conforming mortgage rates were about 7%, mortgage rates dropped considerably, bottoming out at the beginning of October. The 15-year conforming rate dropped into the mid-5% range, and the 30-year fell below 6.5%.
However, rates rose dramatically in October and both the 30-year and 15-year are right at about 7%.
The Federal Reserve was expected to make several interest rate cuts in the coming months, but Trump’s election clouds that outlook because of his proposals on tariffs. At various points in the 2024 campaign, Trump proposed a 10% blanket tariff on foreign goods, a 60% tariff on Chinese goods and a 100% tariff on Mexican goods.
Economists widely believe that tariffs of this magnitude would reignite inflation and force the Fed to pause interest rate cuts, or even prompt it to raise them.