Is Now a Good Time to Buy a House? Here’s What Zillow Economists Say

If you’ve been wondering whether now is the right time to buy a home, you’re not alone. With mortgage rates still elevated, home prices remaining historically high, and economic uncertainty in the air, the decision can feel daunting.

But according to Zillow’s chief economist, Skylar Olsen, the 2025 housing market is shifting—and it could present one of the best opportunities for buyers in more than a decade.

The Big Picture: A Market Returning to Balance

For much of the past few years, sellers have held the advantage in most U.S. markets. Limited inventory and fierce competition meant bidding wars and rising prices were the norm.

That tide is turning. Zillow’s spring 2025 market update notes that the market has returned to more neutral territory, giving buyers and sellers a more even playing field. This shift is fueled by:

• Rising Inventory – More homes are hitting the market, with Zillow projecting 4.2 million listings nationwide this year.

• Slowing Price Growth – Home values are expected to rise a modest 2.6% in 2025. In some areas, prices may even decline slightly.

• Longer Days on Market – Homes are sitting unsold longer, averaging 58 days in July—the slowest turnover in seven years.

Zillow’s Forecast: Why This Year Could Favor Buyers

One standout prediction from Zillow: Home listing prices could fall nearly 2% by the end of 2025.

While that’s not a huge drop, it’s notable in a market that’s been rising relentlessly since 2012. For buyers, this means a rare window to negotiate, especially when paired with the following trends:

• More Negotiating Power – Increased inventory gives buyers leverage to ask for repairs, closing cost credits, or other concessions.

• Shifting Regional Dynamics – Buyer’s markets are expected to emerge in the Southwest and other areas where supply is catching up to demand.

• Fewer Frenzied Bidding Wars – Slower sales mean less urgency and more time to make informed decisions.

The Mortgage Rate Reality Check

Even with these positives, mortgage rates remain a hurdle. As of early fall 2025, rates hover around 6.5%–6.8%. That’s well above the pandemic-era lows, but a recent dip from earlier this year has given some buyers hope.

A Zillow/Investopedia study found that rates would need to drop to around 4.43% for housing to become broadly affordable to median-income households. In pricier metros like New York, Los Angeles, and Seattle, affordability challenges remain even at much lower rates.

What This Means for You

If you’re financially ready, this could be your moment. The combination of rising inventory, slowing prices, and reduced competition makes 2025 potentially the most favorable year for buyers in over a decade.

However, the decision still depends on your personal situation:

• Yes, consider buying now if:

  • You’ve saved for a strong down payment

  • You find a home that meets your needs and budget

  • You’re prepared to stay in the home long enough to ride out market fluctuations

• Maybe wait if:

  • You’re stretching your budget to afford today’s prices and rates

  • You’re banking on a short-term resale for profit

  • Your job or income situation is unstable

Final Takeaway

The housing market in 2025 isn’t without its challenges. Prices are still high, and mortgage rates—while easing—remain elevated. But for well-prepared buyers, this year offers something we haven’t seen in years: more choice, more negotiating room, and a break from the frenzy.

If you’re ready, the key is to be strategic—get pre-approved, stay informed about local market conditions, and be prepared to act when the right home comes along.