The 2025 leadership team for Arizona REALTORS® shared their real estate predictions for the upcoming year, projecting an uptick in market activity as mortgage rates stabilize.
“The presidential election has created a pause in the market for the past three election cycles, which we saw again in 2024,” 2025 President Sindy Ready shared in a press release. “While interest rates aren’t expected to drop dramatically, we are hopeful for slight adjustments. As they stabilize, this is encouraging buyers and sellers to re-engage with the market heading into 2025.”
2025 First Vice President Shane Cook added that pent-up demand will lead to increased transactions in 2025, although the extent of that increase will depend on interest rates.
Furthermore, Lisa Paffrath, 2025 president-elect, predicted that home prices will increase due to high demand, especially in rural markets. “Sellers in markets with stable home prices or longer listing times amid current interest rates should consider adjusting prices in 2025 if their homes linger on the market,” she added.
Meanwhile, the Arizona population will likely continue increasing, further driving demand, according to Treasurer Paul Baker. “Even with moderate interest rate reductions, younger families will stay in the market as buyers regardless of rates and new construction projects,” Baker explained. “Also, new construction projects will continue to gain momentum, particularly among young buyers who are drawn to the idea of ‘new’ and are willing to drive a little farther to get it.”
Additionally, Ready predicted that the prevalence of multigenerational homes will increase next year, with parents moving back in with their adult children or adult children moving back home. “As more families are moving in together, floor plans are evolving to provide more privacy and comfort for multigenerational living, featuring a second primary bedroom or an ensuite bathroom,” Ready said.
She also highlighted which layouts might dominate in 2025. “Open concept floor plans remain a top request from today’s buyers. The combination of an open kitchen and family room, as well as the primary bedroom and bathroom, have long made the biggest impression on prospective buyers.”