Mortgage rates, which surged in 2023 to the highest levels in over two decades, are expected to continue gradually falling through 2025. While economic uncertainty and inflation pushed the 30-year fixed rate above 7% in late 2023, forecasts suggest that by fall 2025, average rates could settle between 5.5% and 6.5%, assuming successful taming of inflation and steady economic growth. The Federal Reserve’s rate policies will continue playing a key role in shaping these projections.
Despite ongoing market volatility, experts forecast a modest improvement in affordability as mortgage rates cool over the next year. However, demand still outpaces supply in many housing markets, keeping home prices elevated. Buyers and investors alike should prepare for a slow, uneven shift in borrowing conditions, while paying close attention to broader economic trends influencing rate movements.
For those focused on Arizona real estate investing, these forecasted rate adjustments are particularly relevant. As borrowing becomes slightly less expensive, opportunities in high-demand Arizona markets such as Phoenix, Tucson, and Flagstaff may become more accessible. Investors monitoring rate trends can better time their purchases or refinancing efforts to maximize returns in this growing regional market. Explore more insights on Arizona real estate investing at https://arizonainvestor.news/.
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