1. Mortgage rates are at the lowest since December 2024, aiding buyers. 2. 1.04 million homes are available, the highest in five years. 3. Home values have increased only 2.1% year over year, slowest in 18 months. 4. Newly pending listings fell nearly 8% compared to last year. 5. Zillow's rental report shows multifamily rent growth outpacing single-family homes.
Lower mortgage rates and increased home availability should drive buyer interest, similar to past market recoveries.
The article highlights key market indicators directly impacting Zillow's business model and future performance.
The immediate effect is from mortgage rates and seasonality; long-term effects may stabilize.
SEATTLE, March 17, 2025 /PRNewswire/ -- Buyers and sellers didn't jump back into the housing market as expected in February, but lower mortgage rates should encourage them in March, according to the latest market report from Zillow®.
Mortgage rates fell by about a quarter of a point over the course of February and have staggered further downward in March, now reaching lows not seen since December. Mortgage rates have enough of an impact on monthly payments to provide significant cost savings for prospective buyers and could help entice some fence-sitting homeowners to list their properties.
Aside from costs, buyers are gaining a leg up in a few areas of the market. For one, they'll see more options when they start shopping — 1.04 million homes were on the market last month, more than in any February since 2020, and 15% more than last year. That's despite a nearly 5% slowdown from last year in the flow of new listings to the market.
"Affordability is still a massive challenge for those who have been waiting to buy a home, but the lower rates we've seen so far in March are taking the edge off," said Skylar Olsen, Zillow chief economist. "Rate dips tend to energize buyers and sellers both; if they continue or hold, we should see more activity. Economic uncertainty is a counterbalance, one that will be felt in some areas of the country more than others. People tend to shelter in place when the future of their job or industry is uncertain."
With more homes for sale, competition among buyers is slower, too. Listings are spending about 23 days on the market before a sale is pending. That's six more days than last year and just four fewer than at this time pre-pandemic — closer to "normal" than at any time since 2020.
Slowing competition means slower growth in home values. Typical home values are up 2.1% year over year, the slowest growth seen in 18 months and the lowest for any February since 2012.
Newly pending listings fell by nearly 8% compared to the prior year, but still stand about 10% above pre-pandemic norms, nationally. Sellers nationwide should expect to fetch premiums on their sale from now through the end of July, according to Zillow research.
Neither buyers nor sellers have a clear advantage in negotiations at the national level, according to Zillow's market heat index — a throwback for this time of year. The last year that happened in February was 2019.
Meanwhile, Zillow's latest rental market report reveals a major shift in market dynamics. With an increase in single-family home construction, a slowdown in new apartment developments, and an affordability pinch, multifamily rent growth is surpassing that of single-family homes for the first time since June 2024.
| Metro Area* | Zillow Home Value Index (ZHVI) | ZHVI Change Year over Year (YoY) | Inventory YoY | New Listings YoY | Market Favors | Newly Pending Listings YoY | Change in Median Days to Pending From Pre-Pandemic |
|---|---|---|---|---|---|---|---|
| United States | $357,377 | 2.1 % | 15.4 % | -4.7 % | neutral | -7.9 % | -4 |
| New York, NY | $682,679 | 5.6 % | -9.2 % | -13.3 % | strong seller | -12.4 % | -30 |
About Zillow Group: Zillow Group, Inc. (Nasdaq: Z and ZG) is reimagining real estate to make home a reality for more and more people. As the most visited real estate website in the United States, Zillow and its affiliates help people find and get the home they want by connecting them with digital solutions, dedicated partners and agents, and easier buying, selling, financing, and renting experiences.
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SOURCE Zillow