The National Association of Realtors (NAR) was one of the more bullish forecasters of the 2025 housing market, but the trade group has revised its outlook.
In its quarterly NAR Real Estate Forecast Summit Update, economists Lawrence Yun and Nadia Evangelou said they now expect existing-home sales to rise by 6% relative to 2024 and finish at 4.3 million in 2025. New-home sales are forecast to rise 10%.
These are downward revisions from the forecast they released in late 2024, which predicted existing-home sales in 2025 to hit 4.9 million and new-home sales to increase by 11%.
NAR also updated its 2026 projections. For next year, it dropped its new-home sales forecast from 8% to 5% growth. Existing-home sales are now projected to grow 11%, which falls in the range of 10% to 15% previously given by the trade group.
Despite the slightly less optimistic view, Yun was upbeat about where the market is headed.
“The worst is over [for home sales],” Yun said on the webinar detailing the update. “The worst for inventory is over. I think the recession probability is still slim. Job additions, lower mortgage rates and all the factors driving home sales are moving positively, so look for more business opportunities this year.”
Strained affordability continues to hold back home sales, and NAR’s updated forecast doesn’t bode well in that regard. It previously predicted home-price growth of 2% in 2025 and 2026, but it has revised these upward to 3% and 4%, respectively.
NAR’s revised existing-home sales number of 4.3 million is more in line with what other forecasters predicted for 2025. The top of the range for sales was NAR at 4.9 million and Realtor.com at the bottom with 4 million.
HousingWire’s comprehensive 2025 forecast — compiled by Lead Analyst Logan Mohtashami and Altos founder Mike Simonsen — predicted 4.2 million in sales and a 3.5% jump in home prices.
How are their predictions holding up so far? According to this week’s report from NAR, existing-home sales for February clocked in at a seasonally adjusted annual rate of 4.26 million, with the median sale price rising 3.8%.
