The housing market's forecast for 2025 is less optimistic as economic uncertainties, particularly stemming from President Trump's tariff policies, keep mortgage rates around 7%. The Federal Reserve is expected to maintain interest rates at 4.25% to 4.5%, with minimal chances of a reduction soon. As job creation continues, consumers remain sensitive to mortgage rates, leading many to withdraw offers. The tightening economic conditions are causing a pullback in consumer spending, increasing fears of a potential recession, accentuated by rising job losses affecting lower-income households.
Many homebuyers are walking away from offers due to economic uncertainty and rising inflation concerns, with mortgage rates remaining near 7% as consumers adopt a cautious spending approach.
The Federal Reserve is unlikely to lower interest rates, maintaining the current range amidst ongoing job market strength, which complicates the outlook for housing and consumer spending.
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