What the Fed's Next Moves Mean for Phoenix Homebuyers and Sellers in 2025.

As someone who's been helping families buy and sell homes in Phoenix for nearly a decade—and now leading a team of eight incredible agents at Andrea Garcia Realty—I’m always watching the bigger economic picture so I can give you the clearest guidance possible. And right now, the Federal Reserve’s actions are at the center of it all.

If you've been wondering when mortgage rates might finally come down, you’re not alone. According to the latest HousingWire insights, the Federal Reserve is expected to hold interest rates steady for now—but there is cautious optimism that we’ll see a couple of rate cuts before the end of 2025.

So, what does that mean for our Phoenix market?

1. Mortgage Rates: Relief on the Horizon (But Don’t Wait Too Long)

Rates have been hovering in the mid-6% range recently. While that’s certainly higher than the ultra-low pandemic-era rates, it’s still manageable—and importantly, many analysts are forecasting that rates could dip closer to 6% or even the high 5% range by the end of the year. That could open up more opportunities for buyers who’ve been sitting on the sidelines.

But here’s what I tell buyers who ask, “When’s the best time to buy a house?” Two things: when you can afford it, and when it’s on sale. Right now, local inventory is on the rise, and demand is lagging behind. That means more choices, less competition, and better negotiating power. Don’t wait for the Arizona real estate sale to end—this may be your window.

2. Home Sales Expected to Pick Up

After a slower 2023, projections for 2025 are much sunnier. The Mortgage Bankers Association forecasts that home sales nationwide will rise to 5.2 million units next year. If the Fed does deliver on rate cuts, we’ll likely see more sellers re-enter the market—especially those who’ve been reluctant to give up their 3% mortgage rates.

That could mean more inventory, more choices, and a healthier, more balanced market for both buyers and sellers.

3. What Sellers Should Know Right Now

If you're considering selling your home in the Phoenix area, the latest market trends are sending mixed signals.

On the plus side, new listings are slowing down. Over the past four weeks, fewer than 10,000 homes hit the market—down from the consistent 10,000+ we've seen earlier this year. This means less competition for sellers, giving your home a better chance to stand out.

However, buyer demand is slipping. After a few encouraging months to start the year, we’re now seeing a decline in homes going under contract—falling to levels not seen since the tough years of 2007–2008.

What does this mean for you? Sellers who prepare well and price strategically can still do well, but timing and marketing are critical in this environment.

With 8 local experts on my team, we’ve got the entire Valley covered—from Laveen to Gilbert, Surprise to Ahwatukee. Let’s talk about how to position your home for success in today’s shifting market.

Final Thoughts

Real estate is hyper-local—and while national trends matter, what’s happening right here in Phoenix is what truly impacts your buying or selling decisions. The Fed’s next moves will shape the financial side, but my team and I are here to guide you through the emotional, practical, and strategic steps to make the most of this shifting market.