If you’re a homeowner considering selling your property, the new administration’s policies could shape the housing market in ways that directly impact your plans. While no crystal ball exists, there are some significant policy shifts and market trends worth keeping an eye on. Here’s what you need to know, based on insights from ATTOM Data, to make informed decisions about 2025 housing market for sellers.
The SALT Deduction Cap: Could It Drive Up Demand?
One of the biggest potential changes is the expiration of the $10,000 cap on state and local tax (SALT) deductions. Introduced in 2017, this cap has made homeownership less attractive in high-tax states like California, New York, and New Jersey.
If the cap expires after 2025 as planned, buyers in these states could regain a significant financial incentive, increasing demand for homes in these areas.
Seller takeaway: If your property is in a high-tax state, 2025 could increase buyer interest. Selling sooner might mean negotiating with fewer buyers while waiting could position you to sell in a more competitive market.
First-Time Buyers: Will Assistance Programs Increase Competition?
First-time buyers are a critical driver of the housing market, but right now, they’re at historic lows—making up just 24% of all buyers in 2024. Rising prices and mortgage rates have pushed many out of the market.
The new administration may address affordability with programs that help first-time buyers, such as down payment assistance or tax credits. If successful, these measures could bring more buyers into the market, particularly for starter homes and mid-priced properties.
Seller takeaway: If your property appeals to first-time buyers, a boost in affordability could mean more competition for your home. Pricing strategically and staging to attract this group could maximize your return.
Inventory and Market Conditions: A Balancing Act
The housing market in late 2024 saw a 19% increase in inventory compared to the previous year, paired with sluggish sales. While this might sound like bad news for sellers, it could actually present an opportunity for those who prepare their properties well. With demand expected to pick up, especially in 2025, homes that are move-in ready or positioned strategically could sell faster and for higher prices.
Seller takeaway: Use the slower market now to prepare your property for sale. Small updates, professional photography, and a targeted marketing strategy could set your home apart when demand increases.
Policy Changes: What to Watch
While specific policy impacts remain to be seen, several areas are worth monitoring:
Regulations and Land Use: If the administration reduces housing regulations or opens federal land for development, more inventory could eventually come to market. However, these changes will take time to impact supply meaningfully.
Mortgage Rates: Lower mortgage rates are often discussed as a goal, but these are influenced by broader economic conditions.
Seller takeaway: Keep an eye on policy changes that might shift buyer affordability and inventory levels. Timing your sale in line with these shifts could maximize your profit.
Is 2025 the Right Time to Sell?
The answer depends on your property, location, and goals, but the outlook suggests 2025 housing market could offer new opportunities for sellers. Whether it’s increased demand due to the SALT deduction expiration or more first-time buyers entering the market, the next couple of years may bring favorable conditions for homeowners ready to sell.
Need Advice on Timing Your Sale?
At Cleveland Property Solutions, we keep a close eye on market trends so our clients don’t have to. If you’re thinking about selling and want to make sure you’re positioned to take advantage of the best timing and strategy, let’s chat. We’ll help you navigate these changes and make the most of your investment.
Reach out today to start the conversation!
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