Buyers market expected to persist ‘for the foreseeable future’ 

Mortgage rates continue to trend downward in the final weeks of 2025, providing relatively favorable financing options for buyers looking to get into the market after the holidays.

The 30-year fixed-rate mortgage averaged 6.18% this week — just a tick above the lowest level of 2025, seen in late October — according to Freddie Mac. Mortgage rates have remained in a narrow range for nearly three months.

"With Fed policy expectations largely priced in (and few signals about January motives), limited new data amid the government shutdown, and thin holiday trading, mortgage rates continue to drift rather than break sharply in either direction," said Jake Krimmel, senior economist at Realtor.com, in an email.

With rates stable, buyers should look at other signals

Mortgage rates may not move much ahead of upcoming economic data releases. A jobs report is scheduled to be released on Jan. 9, while the next major inflation report comes out Jan. 13.

And barring any big surprises, most economists expect rates to remain around current levels in early 2026 — which means prospective buyers should pay attention to local market signals when determining the best time to buy, according to Lisa Sturtevant, chief economist at Bright MLS.

"The level of local inventory at different price points, the pace of local market activity and how often homes sell below asking price in a local market are going to be key pieces of information buyers are going to want to have as they consider their home purchase in the months ahead," Sturtevant said.

Mortgage applications sluggish in mid-December

Potential buyers didn't seem to be thinking about mortgages in the week before Christmas. Overall applications were down 5% for the week ending Dec. 19, with seasonally adjusted purchase applications down 4% from a week earlier, according to the Mortgage Bankers Association.

The softening job market and sticky inflation will continue to be an issue, but the MBA is forecasting modest growth in home sales next year, said Mike Fratantoni, the association's chief economist.

Buyers outnumber sellers by wide margin

Would-be buyers who are ready to turn their attention back to the housing market in January will find other dynamics in their favor. Redfin estimates that there are currently 37.2% more sellers than buyers in the U.S. housing market, more than double last year's gap.

"A modest improvement in housing affordability could bring some homebuyers off the sidelines in 2026, which could narrow the gap between homebuyers and sellers," said Redfin Senior Economist Asad Khan in the report accompanying the data. "But the housing market is likely to remain in buyer's market territory for the foreseeable future, with sellers cutting prices or offering concessions to lure buyers."

The report found that Austin, Texas, had the strongest buyers market, with 114% more sellers than buyers in November. Nassau County, New York, had the strongest sellers market, with 39.1% fewer sellers than buyers.

Wage growth is expected to outpace home price growth next year, according to Chen Zhao, Redfin's head of economics research, which could encourage more buyers to act while the market is in their favor. "Even though prices remain high, buyers have a chance to negotiate with sellers and get some concessions," Zhao said.