Key takeaways

• Home values are expected to end 2025 down 0.9%
• Home sales continue to bounce along the bottom as high costs hold buyers back. Zillow projects 4.09M existing home sales in 2025, up just 0.6% from 2024. 
• 2025 rent growth is forecast at multi-year lows. 

Zillow’s latest forecast expects home values to trend downward through the end of 2025 and sales to match 2024 levels. New listings of existing homes are forecast to outpace sales, helping inventory to finish the year higher. The increase in the number of homes for sale has been more pronounced in the West and the South.

The typical US home value — now nearly flat compared to last year — should remain under pressure, ending the year 0.9% below where it started. That’s not as drastic a dip as was called for last month; the upward revision comes as new listings from sellers fell again in July.

Existing home sales are pegged to end 2025 at 4.09 million, a 0.6% increase over 2024. It’s a downgrade from last month. Weaker-than-expected sales are likely the result of consumer finances that are increasingly under pressure, along with a surprisingly more sluggish labor market.

Slower-than-normal rent growth is expected to continue through the end of the year. The Zillow Observed Rent Forecast (ZORF) for single-family rents projects a 2.5% increase in 2025, down from 4.5% in 2024. Multifamily ZORF calls for a 1% increase in 2025, down from 2.4% in 2024. This is a downward revision from the previous forecast.

This year would mark the lowest annual increase for single-family rents of any calendar year since at least 2018, when Zillow’s data history for this metric begins. For multifamily rents, it would be the lowest increase since 2020.