As we step into 2025, the real estate market stands at a pivotal moment. After several years marked by elevated mortgage rates and limited housing inventory, we’re beginning to see a glimmer of hope. Challenges remain, but so do opportunities, and agents who are Realtors are uniquely positioned to guide clients through this evolving landscape.
This commitment aligns not only with our Code of Ethics, but also with the core principles of good business practice. Protecting consumers is at the heart of what we do — as humans, as Realtors and as business owners — and the new changes we’re navigating are clear examples of how we put these principles into action.
One of the most significant developments shaping real estate is the National Association of REALTORS® settlement that was granted final approval in November. This agreement supports transparency, competition and choice and empowers agents and consumers to negotiate the services and compensation that work for them.
One important change is that many buyer’s agents — those who are required as a part of the settlement — must ask the buyer to sign a written buyer agreement establishing the terms of their relationship before touring a home. These agreements help buyers fully understand their agent’s services by clearly laying out what the buyer can expect to receive and how the real estate professional will be paid. Additionally, while offers of compensation are still an option, if a seller chooses to make an offer available the offer cannot be communicated on MLSs.
As we embrace these new business practices, Realtors remain steadfast in our commitment to serving as trusted guides for our clients during one of the most significant transactions of their lives.
Against the backdrop of these changes, the real estate market is showing signs of stability and recovery. According to NAR Chief Economist Lawrence Yun, home sales are forecast to increase by 9% in 2025 and by 13% in 2026. The housing inventory shortage that has long defined the market is finally easing, with increased new-home construction and more sellers entering the market. These shifts are providing buyers with more options and signaling a much-needed move toward balance in the housing market.
Mortgage rates are also stabilizing. While we’re unlikely to return to the historically low rates of 3-4%, a consistent range of 5.5-6.5% is expected, creating a new normal. The Federal Reserve’s anticipated rate cuts in 2025 will further support this stabilization, giving buyers and sellers the confidence to reenter the market. Together, these factors are laying the groundwork for a healthier housing ecosystem.
Homeownership continues to be the cornerstone of building generational wealth in America. Despite recent challenges, household equity has reached record highs, benefiting millions of homeowners. However, for many buyers — especially first-time buyers — affordability remains a pressing challenge. Saving for a down payment while navigating rising costs and competing priorities is no easy task. To those of you working with these buyers, I applaud your efforts. Your role in guiding these individuals and families toward homeownership is meaningful and impactful. Together, we can ensure that buyers feel supported and prepared to achieve their dreams.
NAR’s focus remains on addressing housing affordability and availability while empowering our members and protecting consumers. This year, we’re advocating for policies that increase housing inventory through tax incentives, improve access to homeownership, ensure equal access to professional representation and expand economic opportunities. Addressing housing affordability starts with adding to the nation’s severely limited inventory. The U.S. is facing a housing shortage of 4.7 million units. America’s tax law can and must do more to promote homeownership, build stable communities and boost economic growth.
Collaboration will also be a defining theme in 2025. By working with local and state associations, we’re addressing challenges and seizing opportunities together. NAR is committed to streamlining operations and aligning every decision with our mission to serve members and protect consumers. Through these efforts, we aim to ensure that every Realtor has the resources, tools and support they need to thrive.
Looking ahead, I’m optimistic about what 2025 holds for real estate. Realtors are resilient, adaptable and the fabric of our communities. Together, we can turn challenges into opportunities, strengthening the real estate market and helping individuals and families build a better future through homeownership.
Thank you for your dedication to this profession and your unwavering commitment to your clients. Here’s to a year of recovery, opportunity and growth.
Kevin Sears is president of the National Association of REALTORS®.