Discover how 2024 shaped the real estate landscape for 2025.

 

Last year was challenging for real estate, marked by fluctuating rates, market changes, and many other factors. Today, I wanted to recap some housing trends and share what we can expect this year.

 

Listings and home sales. In the $1.1 million range, 2023 had 50 listings, and 60 sold. By 2024, listings jumped to 150, but only 50 sold, showing a big increase in available homes.

For the $1.9 million range, there were 100 listings in 2023, with 50 sales. In 2024, listings soared to 260, and 90 sold, indicating stronger buyer interest in that price point.

In the $2.5 million range, there were 200 listings in 2023, with 50 sales, and around 150 listings with 48 sales in 2024. While not many are buying at $1.9 million, there are still some interested buyers.

Absorption rates. Absorption rates measure how quickly homes sell. In 2022, the rate was about 2.29 months. It increased to 3.41 months in 2023 and slightly rose to 3.53 months in 2024, indicating that homes are taking longer to sell, especially after the pandemic.

 

In some Flagstaff neighborhoods, homes still receive multiple offers, but it’s less common than it used to be.

 

 

Mortgage rates might stay higher, but there are ways to manage that.

 

Average list, average sale price, and days on market. In 2022, the average list price was about $803,472. It increased to $847,462 in 2023 but dropped to $817,864 in 2024.

The average sale price followed a similar trend, starting at around $650,000 in December 2022, rising to $653,000 in 2023, and then jumping to $738,620 in 2024. Overall, prices are still increasing.

Regarding cumulative days on the market, homes took about 86 days to sell in 2022, 118 days in 2023 and then decreased to 101 days in 2024.

What should we expect for the housing market in 2025? Mortgage rates are expected to remain higher for a bit longer, but there are ways to manage them. If you'd like to discuss your options, we can connect you with one of our preferred lenders.

 

Home values are projected to keep rising nationally, which typically benefits sellers in negotiations, although local market conditions can vary.

 

In 2023, the average 30-year mortgage peaked at 7.79%. Fannie Mae forecasts that by 2025, it will drop to around 6.4%. While that's not as low as 3%, it’s certainly better than 7%.

 

Will rates drop back down to 3%? Historically, mortgage rates have never dropped to 3%. Typically, 30-year rates have averaged between 4% and 6%, even during challenging times like the housing crisis. Therefore, a return to 3% seems unlikely.

 

That’s just a quick look at last year. We’re really excited about 2025, as it looks like we’ll have more inventory than we've seen in a while. Many homeowners are ready to list their properties and move on from those low interest rates.

If you’re curious about the market or have any questions, feel free to give me a call at (928) 606-6749, send an email to Kelly.Broaddus@eXpRealty.com, or stop by the office at 619 North Humbpreys. You can also check out our website at NorthernArizonaFineHomes.com. I’m here to help anytime!