Jun 20, 2025
June 20, 2025
Overview:
- The Realtor.com® economics team video update gives you the relevant economic and real estate information you need to know each week every Friday to navigate the housing market as a homebuyer, home seller, or industry professional.
- For the week ending June 20, Realtor.com® Chief Economist Danielle Hale discusses the June Fed meeting. She also reviews what happened to mortgage rates and new construction in May. She zooms in on recent trends using weekly housing data, and takes a step back to see the big picture in household real estate equity. Finally, she looks at what we saw in the May 2025 Rental Report.
Reports and articles referenced:
- May 2025 Rental Report:
https://www.realtor.com/research/may-2025-rent/ - Weekly Housing Trends Report – June 14, 2025:
https://www.realtor.com/research/weekly-housing-trends-view-data-week-june-14-2025/ - Commentary on 2025 Q1 Household Equity:
https://www.realtor.com/research/changes-in-value-of-household-real-estate-q1-2025/ - Commentary on Mortgage Rates – June 18, 2025:
https://www.realtor.com/research/freddie-mac-mortgage-rates-june-18-2025/ - Commentary on June 2025 FOMC Meeting:
https://www.realtor.com/research/federal-reserve-june-2025-meeting/ - Commentary on May 2025 New Construction:
https://www.realtor.com/research/new-home-construction-may-2025/
Housing data for download:
VIDEO TRANSCRIPT:
- I’m Danielle Hale, Chief Economist at Realtor.com®. This week I’m going to discuss the June Fed meeting. I’ll review what happened to mortgage rates and new construction in May. I’ll zoom in on what’s happened recently using Realtor.com weekly housing data, and take a step back to see the big picture in household real estate equity. Finally, I’ll look at what we saw in the Realtor.com May 2025 Rental Report.
- Let’s start with the Fed, which kept its policy rate steady in June. Even as inflation data improved, a still-healthy labor market enabled the Fed to wait and see how tariffs may ultimately impact price trends.
- Keeping the end goal in mind, Chair Powell told reporters in response to a question, “The best thing we can do for the housing market is to restore price stability in a sustainable way and create a strong labor market.”
- The Fed’s new projections revealed a modest downgrade to economic growth and a slight uptick in unemployment and inflation through 2027. The median expectation for the policy rate is unchanged for 2025, consistent with 2 quarter point rate cuts by the end of the year. This means, if the economy evolves as expected, the Fed’s policy rate could fall below 4% by December.
- In the mortgage market, rates on a 30-year fixed rate loan dropped for a third straight week. But again, the improvement was fairly modest, keeping rates relatively high.
- In this context, builder confidence fell in June from an already low May level. Consistent with sluggish confidence, both total housing permits and housing starts dropped to 5-year lows. A fairly steady pace of housing completions at the same time that builders sensed waning demand from buyers prompted an increase in price cuts and other incentives for new home buyers, meaning it’s not a bad time to be a new home buyer.
- Looking at Realtor.com weekly housing data we see that home prices were steady and buyers had more time to make decisions as the number of homes on the market continued to climb compared to last year. While new listing growth rose again from last week, it trailed behind what we’ve seen year to date and will be an important indicator to watch as regional real estate trends diverge and the market’s balance shifts back in favor of buyers.
- Taking a step back, recent home price trends caused a dip in the value of household real estate from prior quarters, but the value of homes is still higher than one year ago totaling $47.9 trillion in the first quarter [of 2025]. Combined with rising mortgage debt, this also meant a drop in home equity in the first quarter, but a gain relative to the prior year. As a share of today’s total housing value, equity remains close to long-term highs, reflecting the strong position of today’s homeowners in aggregate. The picture for individual homeowners can and will vary.
- Finally, it’s important to keep tabs on the rental housing market, since many aspiring homeowners are currently renting. The May 2025 Rental Report showed yet another decline in rents. This cooling trend has helped keep the upward trend in rent below that of overall inflation over the past 6 years, even though both have moved up notably. But again, there’s significant local variation in rents.
- You can find all the details, including full reports and our housing data for download, at realtor.com/research. You can also follow us on X (formerly twitter) for real time updates. And instagram for graphics.
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