2025 Portland Real Estate Market Forecast

Happy New Year! I hope you had a wonderful holiday season and I wish you and yours a healthy, happy, and peaceful 2025.

It’s time to discuss what to expect with the Portland metro real estate market in 2025.

The biggest question looming over the market at this point is what will happen with interest rates, as the higher rates have really stagnated the market since the end of 2022. Per Freddie Mac, the national 30 year fixed rate fluctuated in 2024 between 6.08% in late September to 7.22% in May. They’re currently at 6.91%.

Through November, 2024, median home prices were up 2.3% year to date, and 1.4% compared to November, 2023.
Rates dropped below 6.5% for nearly two months from mid-August to mid-October and the median home price increased during the lagging months. I do believe there has been some pent-up demand with the higher rates, so if we can see a drop into the low 6% range or lower, we should see a bump in prices accordingly. That being said, if we stay in the high 6% to low 7% range, I believe prices will trend mostly sideways.

So the big questions is, where are rates headed? It really depends on who you ask…

It appears the general consensus is that rates will drop from where they are now, but how much (if at all) will really determine what happens with pricing (and inventory, and days on the market, and closings, etc.).

One other significant item to take into consideration is how the recent presidential election might impact the housing market this year. If you missed it, I included a lot of information about how presidential elections impact the real estate market a few months ago. But let’s focus on the 3 big items here:

1. Home sales increased 9 times after the last 11 elections.
2. Existing home prices when up 7 times after the last 8 elections.
3. Mortgage rates dropped 8 times after the last 11 elections.
That all bodes well for those looking for prices to continue their ascent in 2025.

There are still some big question marks though.

The economy is obviously an extremely complicate thing, and there are all sorts of things that could impact it that are way above my pay grade to try to predict. That being said, one item that’s already being discussed is that Trump’s planned tariffs could cause higher inflation, which would likely cause higher mortgage interest rates, and therefore impact housing prices.

While my crystal ball is quite hazy, I’d guess rates end up in the 6.25%-6.5% range and median home prices are up about 3% at the end of 2025. Don’t hold me to it though, it’s just a guess based on some experience and more importantly what I see others says.

What do you think will happen? I’d love to hear what you see in your crystal ball!