Private Home Sales Triple in Q4 2024 as Rates Decline

The private home sales market experienced a significant turnaround in the fourth quarter of 2024, with sales tripling compared to the previous quarter. This surge can be attributed to a decline in mortgage rates, which made homeownership more affordable for potential buyers. The average 30-year mortgage rate in 2025 was around 7%, lower than the peak levels of 2024 but still higher than pre-2022 levels. This decline in mortgage rates led to an increase in demand for private homes, as evidenced by the 2.2% increase in existing home sales and the 3.6% increase in new home sales in December 2024.

Despite the increase in demand, the overall housing market dynamics remained relatively stable. The inventory of homes for sale remained near historic lows, and potential sellers were not pressured into selling due to job loss. This led to a situation where homeowners chose to remain in their homes rather than taking on a new mortgage with higher interest rates. As a result, sales prices remained high, and the market remained steady.

However, the decline in mortgage rates also had an impact on the demand for private homes. The lower interest rates made homeownership more affordable, leading to an increase in demand for private homes. This increase in demand, coupled with the stable market dynamics, contributed to the surge in private home sales in Q4 2024.

In conclusion, the decline in mortgage rates in 2025 had a significant impact on the demand for private homes, leading to a surge in sales in the fourth quarter of 2024. Despite the increase in demand, the overall housing market dynamics remained relatively stable, with homeowners choosing to remain in their homes rather than taking on new mortgages with higher interest rates. The surge in private home sales highlights the importance of understanding market trends and economic conditions when investing in real estate.