Everywhere you turn lately, someone is asking the same question: "Is the housing market about to crash?"
From alarming headlines to social media speculation, it’s no wonder people are feeling uneasy. In fact, a recent survey from Clever Real Estate found that 70% of Americans are worried about a potential housing market crash in 2025.
Before you put your moving plans on hold, take a deep breath. The truth is that the housing market isn't crashing—it's adjusting. And that adjustment could actually work in your favor.
Low Inventory Is Keeping the Housing Market Stable
One of the key reasons a crash is unlikely? There simply aren’t enough homes to go around.
As Mark Fleming, Chief Economist at First American, explains:
“There’s just generally not enough supply. There are more people than housing inventory. It’s Econ 101.”
Think of it like concert tickets for a major show: when demand is high and seats are limited, prices hold steady or go up. The same rule applies to real estate. Even though inventory is improving, it's still well below pre-pandemic norms.
Just look at the white line in the graph below showing March 2025 active listings: 892,561 homes, still far lower than the 1.2 million+ listings we saw in 2017 through 2019.
As long as this shortage continues, home prices won’t fall dramatically. There just aren’t enough homes to cause a market-wide collapse.
Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), puts it plainly:
“. . . if there’s a shortage, prices simply cannot crash.”
More Inventory = Healthier Price Growth
Although home prices aren’t crashing, they are starting to grow more slowly thanks to rising inventory. And that’s a good thing.
Price moderation means that while homes are still appreciating, the pace has cooled. This makes buying more accessible for more people—especially those who have been priced out in recent years.
According to Freddie Mac:
“In 2025, we expect the pace of house price appreciation to moderate from the levels seen in 2024, while still maintaining a positive trajectory.”
In other words, prices are still rising, just not at breakneck speed.
You can see this in the graph below. After peaking at 7.0% year-over-year growth in February 2024, price increases have steadily declined throughout the year, hitting 4.8% by January 2025.
This kind of growth is more sustainable and signals a healthier housing market overall.
Local Markets Tell Different Stories
It’s important to remember that while national trends provide useful context, real estate is local.
Some regions are seeing faster inventory growth and slower price appreciation, while others remain tight. That’s why you should always consult a local real estate expert to understand what’s happening in your specific area.
They can provide insights into:
Whether your area is leaning toward a buyer’s or seller’s market
How quickly homes are selling
What price trends to expect
With this local guidance, you can make informed decisions about your next move.
Bottom Line
Despite what you may hear, a housing market crash in 2025 is highly unlikely. Thanks to low inventory and steady buyer demand, the market remains stable. We’re entering a phase of balance and sustainability—not collapse.
As Business Insider puts it:
“. . . economists who study housing market conditions generally do not expect a crash in 2025 or beyond unless the economic outlook changes.”
This shift creates opportunity. With price moderation, more homes on the market, and less buyer competition, now could be a great time to make your move.
At Best Option Mortgage, we're here to help you navigate the housing market with confidence. Whether you're buying your first home or looking to refinance, our experienced team will walk you through your options and help you secure the right loan for your needs.
Let’s talk about your goals and get you ready for a smart, stable move in 2025. Contact Best Option Mortgage today.
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