Fox News real estate contributor Katrina Campins argues ‘something needs to happen’ in the housing market as supply challenges create obstacles for the industry.
2025 will mark a resurgence in home listings and sales in the U.S. real estate market after years of stagnation, according to the Agency founder and CEO Mauricio Umansky.
Though some uncertainties in the real estate market remain, such as when and by how much interest rates will drop, Umansky said we are finally going to see some movement.
Umansky, who is also famous for his time on The Real Housewives of Beverly Hills, has a global real estate brokerage with over 130 offices across 12 countries. It just launched its fifth annual Red Paper, which is a comprehensive wealth report, which includes a deep evaluation of the luxury real estate market and upcoming expectations for the rapidly changing industry.
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If it hadn’t been for the pandemic, which caused a significant shift in the residential and commercial real estate markets, Umansky believes that we would have “already started to see a big price correction.”
Typically, when you have significantly low transactions, like what we saw in the 90s, prices start coming down and “buyers start entering the market again because now it’s a value play,” he said. But given the lack of supply in the industry, prices hadn’t dropped that much.
The Agency CEO Mauricio Umansky and President Rainy Hake Austin standing outside one of their offices. (The Agency)
Sellers who locked in a record-low mortgage rate of 3% or less during the pandemic began had been reluctant to sell, limiting supply further and leaving few options for eager would-be buyers. But the high interest rates even hindered high net worth transactions.
According to the Agency’s report, 66.67% of agents reported that interest rates directly affect the high-end market. Umansky explained that while many wealthier clients prefer to pay in cash, they often choose to borrow against their real estate portfolios to keep their capital working for them and generating returns.
A year and a half ago, he recalled telling sellers to be patient “because there were no fish in the ocean.” Today, the buyers exist, albeit they are looking for value, he said, underscoring how it remains a buyers’ market.
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In 2025, “there’s definitely going to be a transaction volume increase. Everything is going to start going into the right direction,” Umansky said.
He said the firm believes there is going to be an increase in supply and lower interest rates, though the exact rate will depend on broader economic factors.
A for sale sign is displayed outside of a home for sale on August 16, 2024 in Los Angeles, California. (Photo by Patrick T. Fallon / AFP) (Photo by PATRICK T. FALLON/AFP via Getty Images) / Getty Images)
According to the report, inventory had already climbed 66.67% from January to November 2024 compared to the same period the previous year. Coupled with increased confidence in the economy, these factors are expected to drive more people into the market.
More people will be willing to move now that the election cycle is over too.
“Historically in New York the market from mid-September through the end of November freezes,” during election years, according to Mike Biryla, an agent at The Agency New York.
“Regardless of who wins, 50% of the population is upset and people think that the world is going to end, and then come January or February things start to normalize and usually around March we’ll start seeing the market pick back up.”
Contractors work on a home under construction in Antioch, California, US, on Tuesday, June 14, 2022. (Photographer: David Paul Morris/Bloomberg via Getty Images / Getty Images)
Umansky projected that prices in the luxury real estate market are expected to drop, particularly in terms of final sale prices.
While asking prices may not decrease, Umansky explained that the difference between the bid and the asking price is narrowing. Sellers are increasingly accepting offers much closer to the bid than to their original asking price.
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Given that it’s a buyer’s market, sellers in 2025 “need to listen to the market” and ensure they understand the current value of their home, according to Umansky.
If they’re not willing to sell at a specific price, Umansky advised that they should consider taking their homes off the market entirely to avoid accumulating days on the market and becoming stale.
“If you’re not selling, you got to look at your price,” he said.
