The median asking price for a home in the United States will likely go up by about 4% next year, according to a report by Redfin, an online real estate brokerage firm.
The 4% annual pace, which is similar to that of the second half of this year, is a "normalization" compared to the accelerated growth last seen in 2020, said Daryl Fairweather, chief economist at Redfin.
However, Selma Hepp, economist at CoreLogic, said home price appreciation might stay flat, or less than 1%, going into next year's spring home buying season, according to NBC News.
And according to Jacob Channel, senior economist at LendingTree, if President-elect Donald Trump enacts some of his policies such as tariffs and mass deportations, that could cause higher construction costs and slower home-building activity.
He pointed out that if fewer homes are constructed in a supply-constrained market, prices might go up much higher.
The median sales price for a single-family home in the U.S. was $437,300 in October, an increase from $426,800 a month prior, according to the latest data provided by the U.S. Census.
About 4 million homes are expected to be sold by the end of next year, an annual increase between 2% and 9% from 2024, according to Redfin.
The market is piling on with "people who need to move on with their lives," such as buyers who are getting new jobs and need homes suitable for life changes and sellers who have delayed plans to move, Fairweather said.
Hepp said, "We'll definitely see more buyers out there, but I don't see the competition heating up to the levels that it has over the last few years."