Before we look ahead to 2025, it’s important to briefly review what has occurred in the last quarter of the 2024 Johnston County real estate market.
Navigating the recent housing market has become increasingly challenging for buyers. Especially due to recent elevated mortgage rates and a persistent shortage of available homes. The good news is our Johnston County housing inventory has seen a resurgence going into the holidays. As we head into 2025, buyers should have more options to choose from.
4th Quarter Mortgage Interest Rates
Right after Fed Chairman Powell announced a rate reduction of .75 bps, rates actually went up on 30-year fixed mortgage rates fluctuating between 6.08% and 7.44%.
Needless to say, affordability has become a significant barrier for many aspiring first time home buyers.
Meanwhile, the home price spikes seen during the pandemic have largely held steady, keeping homeownership out of reach for many prospective buyers.
Is Homeownership Still Achievable?
For countless individuals, these factors have meant putting their dreams of buying a home on hold. Compared to just a few years ago, home prices remain much higher, and when combined with today’s increased borrowing costs, monthly payments can be nearly double what they were pre-pandemic. Could it be the 2025 housing market will be more favorable for home buyers?
Will Real Estate Prices Fall in 2025?
Not according to Realtor.com! In fact, this tool states prices in the Clayton, NC real estate market will actually increased 9% from 2024!
We fully believe prospective Johnston County home buyers will likely re-enter the market. Especially as interest rates moderate again. The simple law of supply and demand will mean greater competition which will in turn drive up home values.
The RiverWILD Real Estate Team believes that prediction of 9% is pretty aggressive. Our 2025 prediction is for a 5% increase in home values in Johnston County for 2025!
Will Interest Rates Rise or Fall in 2025?
We have already heard Zillow expects interest rates to fluctuate throughout 2025. This will result in more refinancing when rates dips.
Realtor.com predicts interest rates will average around 6.3%, with rates finishing at the year-end figure at around 6.2%. While these rates are slightly lower than 2024, rate volatility could impact buyer confidence.
The RiverWILD Real Estate Team predicts mortgage interest rates will remain in the mid 6% range for most of 2025.
What will Happen to the Available Inventory of New and Existing Homes?
Zillow anticipates that 2025 will bring further relief to buyers as housing inventory continues to expand, providing more choices and greater leverage during negotiations.
Similarly, Realtor.com projects an 11.7% increase in inventory for 2025. While this growth is slightly below the 15.2% rise forecasted for 2024, it still represents a significant improvement compared to recent years of tight supply.
It is our prediction as the RiverWILD Real Estate Team that the inventory of new and used homes for sale in Johnston County will increase in 2025 over 2024! This increase will help home buyers have more choices compared to the last several years. We foresee a more balanced market, with a slight favor still toward home sellers.
Smaller Homes & Pet-Friendly Options on the Rise
Zillow has identified a notable shift in buyer preferences, with demand increasing for smaller, more affordable homes. In 2024, (thanks to agents using ChatGPT) the word “cozy” appeared in 35% more listings compared to 2023, highlighting a trend toward sustainable, functional living spaces that prioritize efficiency over sprawling layouts.
Entry-level buyers are also finding opportunity as smaller condos, townhomes, and starter homes stabilize in value, providing a more accessible path to homeownership in today’s challenging market. In Johnston County, builders started building more townhomes to aid in affordability.
Accommodating Our Furbabies!
Meanwhile, the demand for pet-friendly accommodations continues to reshape the rental market. With 58% of renters now owning pets—up from 46% pre-pandemic—rental property owners are under growing pressure to cater to pet owners, creating heightened competition in this sector.
This prediction is actually easy! Our RiverWILD Homes partner has already implemented scaling to smaller new townhomes and detached homes to aid in home affordability.
In addition, the RiverWILD Leasing Department currently accommodates pets in their rental units. For information on pets and rental criteria, please read more here!
Will 2025 See an Increase in Home Sales?
Zillow predicts that existing home sales nationwide will see a slight uptick in 2025, reaching 4.3 million—up from 4.1 million in 2023 and an anticipated 4 million in 2024.
Realtor.com offers a more conservative estimate, projecting 4.07 million home sales in 2025, reflecting a modest 1.5% growth from the 4.01 million expected in 2024.
Mortgage rate volatility will likely to play a critical role in shaping sales activity. For example, when rates dropped to 6.08% in September 2024, the market responded with an 11.6% surge in new listings and a 9.9% increase in sales the following month. We experienced this same surge in sales in Johnston County!
The RiverWILD Real Estate Team predicts overall Johnston County home sales in 2025 will increase by 10% for new construction and 5% in existing homes over 2024!
What’s Your Take?
Be sure to let our team know if you feel these predictions are in line or a pipe dream!
Serious about buying, selling or renting in 2025? Let’s chat about your specific needs!