16 Cities Poised for Double-Digit Home Price Growth in 2025 as Mortgage Rates Decline

Housing Market Poised for Rebound in 2025 as Mortgage Rates Decline

As the housing market navigates through a prolonged slump, experts are predicting a significant rebound in 2025, driven by falling mortgage rates and an increase in home inventory. According to Leo Pareja, CEO of eXp Realty, the anticipated drop in mortgage rates below 6% could ignite a surge in home sales, with estimates suggesting a 10% increase in transactions next year. This optimistic outlook contrasts with Realtor.com’s more conservative forecast of just 1.5% sales growth.

The potential for a revitalized housing market comes as both buyers and sellers have been waiting for more favorable conditions. With mortgage rates easing, many prospective homeowners are expected to re-enter the market, while sellers may feel encouraged to list their properties, leading to a more balanced supply and demand dynamic.

Realtor.com has identified 16 metropolitan areas across the United States that are set to experience double-digit growth in home prices in 2025. Florida stands out as a hotspot, boasting five cities on the list, with Jacksonville narrowly missing the cut at a projected 9.8% increase. The following cities are expected to see the most significant price appreciation:

1. Phoenix, Arizona: 13.2% price growth, 12.2% sales growth
2. Colorado Springs, Colorado: 12.7% price growth, 27.1% sales growth
3. Tucson, Arizona: 12.4% price growth, 12.5% sales growth
4. Boise City, Idaho: 12.3% price growth, 2% sales growth
5. Las Vegas, Nevada: 12.3% price growth, 5.5% sales growth
6. Orlando, Florida: 12.1% price growth, 15.2% sales growth
7. Ogden, Utah: 11.8% price growth, 2.2% sales growth
8. Tampa, Florida: 11.8% price growth, 9.1% sales growth
9. Deltona/Daytona Beach, Florida: 11.5% price growth, 7.2% sales growth
10. Memphis, Tennessee: 10.5% price growth, 8.3% sales growth
11. Sarasota, Florida: 10.4% price growth, 3.2% sales growth
12. Lakeland, Florida: 10.3% price growth, 10.6% sales growth
13. Atlanta, Georgia: 10.2% price growth, 15.1% sales growth
14. Austin, Texas: 10.2% price growth, 14.5% sales growth
15. Durham, North Carolina: 10.1% price growth, 14.1% sales growth
16. San Antonio, Texas: 10% price growth, 6.7% sales growth

While the overall national home price growth is projected at 3.7%, the cities listed above are expected to outperform this average significantly. As buyers and sellers prepare for a more active market, the coming year could mark a turning point for the housing sector, offering renewed opportunities for both parties.

As the landscape evolves, potential homeowners and investors should keep a close eye on these emerging markets, as they may present lucrative opportunities in the near future. With the right conditions aligning, 2025 could be a landmark year for the U.S. housing market.