Mid-Year Market Snapshot: Why Fall 2025 Could Be Stronger

As we reach the midpoint of 2025, the real estate market has sent mixed signals to buyers, sellers, and industry professionals alike. Mortgage rates have remained higher than many had hoped, home prices are holding steady near record highs, and inventory has finally begun to rise. But there’s growing optimism that fall could bring a stronger, more balanced housing market.

Where We Are Now

1. Mortgage Rates Remain Elevated—but Stable

Mortgage rates have hovered in the 6.7% to 6.9% range for much of Q2. While this is significantly higher than the historic lows of 2020–2021, the stability in rates is helping buyers and sellers adjust expectations and plan accordingly.

2. Inventory Is Climbing

Nationwide, housing inventory is up roughly 14% year-over-year. In key markets—including Maine—listings have surged as more homeowners finally decide to sell. This is creating a less frenzied buying environment and giving buyers more options.

3. Home Prices Are Leveling Off

While prices remain elevated, the rate of growth has slowed. In some markets, prices have even dipped slightly—creating opportunities for patient buyers. In Maine, homes are sitting longer on the market than they did in 2022 and 2023, giving buyers a bit more negotiating power.

4. Buyers Are Getting Picky

With more homes to choose from and higher borrowing costs, buyers are being more selective. Homes that are overpriced, under-prepared, or located in less desirable areas are sitting longer.

Why Fall 2025 Could Be a Turning Point

• Seasonal Patterns Favor Fall Sellers: Historically, fall brings serious buyers to the table—those who want to close before the holidays or end-of-year financial deadlines.

• Economic Forecasts Show Improvement: If inflation continues to moderate, the Fed could begin reducing rates later in the year, which would boost buyer affordability and confidence.

• More Realistic Sellers: After months of longer market times and price adjustments, sellers may approach the fall market with more realistic pricing and flexible terms.

• New Construction May Ease Pressure: While building slowed early in the year, many developments are projected to finish in late summer, adding to fall inventory and possibly reducing upward pressure on prices.

Tips for Buyers and Sellers

For Buyers:

• Take advantage of increasing inventory now and watch for more negotiation room in the fall.

• Lock in rates if they dip or consider rate-buydown incentives.

For Sellers:

• Price competitively from the start—buyers have options.

• Prep your home now to hit the market in early fall, when buyer urgency rises.

Bottom Line

The first half of 2025 has been defined by adjustment—higher rates, cautious buyers, and more realistic sellers. But the second half, especially fall, could usher in a stronger, more active market. Whether you’re looking to buy or sell, understanding current trends and preparing strategically can position you for success as the market picks up momentum again.