Fifteen percent of Americans plan to buy a home this year, according to a new report by NerdWallet—the highest share since the personal finance company started asking in 2019.
That’s despite the fact that rising home prices and stubbornly high mortgage rates continue to keep many aspiring homebuyers on the sidelines of the market, and inventory remains historically low.
“People are wildly optimistic,” NerdWallet’s home and mortgage expert Holden Lewis told Newsweek. “Fifteen percent of adults come out to around 39 million. In reality, fewer than 5 million new and existing homes will be bought this year.”
Why It Matters
Soaring home prices and nearly doubled mortgage rates have led to housing affordability dropping in every major metropolitan area of the country over the past five years, according to experts. Millions of Americans have been affected by the ongoing crisis, which became one of the most discussed issues in the country in the lead-up to the 2024 presidential election.
During his presidential campaign, Donald Trump vowed to increase inventory, lower mortgage rates, and make housing more affordable. However, experts fear that some of his policies, including mass deportations of migrants and tariffs on allied countries, might lead to further home price increases and keep many Americans off the property ladder.
What To Know
According to NerdWallet’s 2025 Home Buyer Report, a rather ambitious number of Americans want to buy a home this year, even as nearly seven in 10 of the company’s survey respondents feel the housing market has never been worse for buyers than now.
As Lewis said, these people are likely being a little too optimistic. Prospective buyers told NerdWallet they hope to spend about $259,088 on average for a property; the actual median sales price at the national level, however, is about $420,000.
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Chances that everyone who plans to buy a property this year will manage to do so are slim, based on precedent: only 28 percent of Americans who began 2024 intending to buy a home did so, NerdWallet found. Eighteen percent said they couldn’t afford the homes that were available.
According to Lewis, “The biggest problem is that not enough homes are for sale. The low inventory pushes prices upward as buyers compete with one another.”
The fact that the housing market remains challenging for most Americans is evident from the percentage of those not planning to buy a home this year. Thirty-five percent of nonhomeowners told NerdWallet that the cost of living was stopping them from buying a home.
Among current homeowners, the most common roadblock (23 percent) for buying a new home was high mortgage rates.
“Frustrated buyers said they have been thwarted by high home prices, a rising cost of living, an inability to find a home that meets their needs and high mortgage rates,” Lewis said of the report’s findings.
“This year, they’ll still be blocked by high home prices and elevated mortgage rates. But buyers will find that they have more homes to choose from, and the growing inventory of homes for sale will slow the rise in home prices. We won’t see a decline in prices in most of the country, but prices won’t go up as fast.”
Why Do So Many Americans Want To Buy This Year?
It might seem curious that a growing number of Americans are planning to buy a home this year despite no evidence of significant improvement in housing affordability.
According to Lewis, “there’s clearly pent-up demand” from the last five years when many who wanted to buy a home couldn’t afford to.
“Three million fewer homes were sold from 2022 through 2024 compared to the three years before the pandemic,” Lewis explained. “That means millions of people are eager to own a home but haven’t been able to accomplish their goal.”
What Happens Next
According to Lewis, affordability might improve this year—though only in certain areas of the country.
“Home prices fell last year in some markets in Texas, Florida and Colorado. We might continue to see affordability improve in 2025 in those places,” he said.
“The affordability outlook is muddier when you look at the country as a whole because the course of mortgage rates is uncertain. The 30-year mortgage might stay above 6.5 percent for much of the year, making it harder to afford a home.”
As of January 23, the 30-year fixed-rate mortgage was 6.96 percent, according to Freddie Mac, having declined for the first time in six weeks.
Fifty-four percent of Americans think there’s too much pressure to own a home in the U.S. If you agree, we’d like your opinion. Contact g.carbonaro@newsweek.com.