Rising home prices and stubbornly high mortgage rates are keeping buyers on the sidelines this year — stalling what’s usually the hottest season for real estate.
Adding to the housing crisis are the surplus of homes on the market and a worries over the rocky US economy.
Usually a robust season for the housing market, spring sales have slumped — a worrying indicator of the crash many believe is coming.
But Warren Buffett’s real estate company is offering a glimmer of optimism for the second half of the year.
Berkshire Hathaway Home Services expects to see a market revival, saying that the slower housing market will eventually lower mortgage rates, making it more affordable for people to buy a home.
‘While the spring and summer home buying season should still be robust, it’s likely that sales volume will be lower due to irrepressible home prices and mortgage interest rates,’ reports Berkshire Hathaway.
‘If consumers continue to hunker down through the first half of the year, interest rates could fall slightly.”
Soon, home sellers will adjust to market realities and lower their prices, according to the company, which adds that the best time to buy could be right around the corner.
House showings tend to increase during the tail end of the summer months
Warren Buffet’s real estate company has a surprising prediction for the second half of 2025
Berkshire Hathaway Home Services expects to see a market revival later this summer
‘It could be that Q3 2025 will turn out to be the best time to buy a home this year,” the BH blog stated.
House showings tend to increase during the tail end of the summer months and families will time their moves to be finished before the start of a new school year.
That’s a hopeful outlook, especially since the current housing market has been labeled a ‘dud’ by Redfin, which confirms it has completely stalled.
The National Association of Realtors found that existing home sales dropped 5.9 percent between February and March 2025, a time of year when sales typically rise.
According to a report from JPMorgan.com, there are 481,000 new homes for sale across the US, the highest level since 2007.
Interest rates remain high and rents have declined causing builders to back off of building multi-family apartments.
Higher rates are also keeping potential home sellers locked into their homes as they don’t want to give up their current mortgage loans to buy more expensive housing at higher interest rates.
The National Association of Realtors forecasts that mortgage rates will average 6.4 percent in 2025 and dip a little to 6.1 percent in 2026.
Houses are sitting on the market due to a combination of rising inventory and falling demand
Florida is one of the markets where sellers are dropping prices on homes at a fast rate
NAR predicts existing home sales will rise by 6 percent in 2025 to 11 percent in 2026.
But on the downside, while the summer homebuying season should still be better, it’s likely that overall sales volume will still be lower than years past due to expensive home prices and those still-high mortgage rates.
Despite Buffet’s news, a recent report warned that five metro areas — three in Florida and two in Arizona — are seriously at risk of a housing market crash in 2025.
‘The big picture still is one of a very subdued housing market,’ said Oliver Allen, senior US economist at Pantheon Macroeconomics.
This week Buffett revealed the heartbreaking real reason he’s stepping down from Berkshire Hathaway.
Earlier this month, the ‘Oracle of Omaha’ attracted gasps and then a standing ovation when he broke the news during the annual meeting of his firm.
At the time, Buffett. 94, gave no specific reason — merely endorsing long-time chairman Greg Abel as his successor, starting in 2026.
However, in a new interview, Buffett admitted that his age was finally catching up to him as he headed toward his mid-90s.
‘I didn’t really start getting old, for some strange reason, until I was about 90 but when you start getting old, it does become – it’s irreversible,’ he told the Wall Street Journal.
