The head of a multi-billion dollar brokerage firm gives his view on the real estate market in 2025

The year 2025 will represent A A rebound in home listings Sales in the American real estate market after years of stagnation, according to the agency’s founder and CEO Mauricio Umansky.

Although some uncertainties remain in the real estate market, such as when and by how much interest rates will fall, Umansky said we will finally see some movement.

Umansky, who is also famous for his time on The Real Housewives of Beverly Hills, has a global real estate brokerage with more than 130 offices in 12 countries. It has just launched its fifth annual Red Paper, a comprehensive wealth report, which includes an in-depth assessment of the luxury real estate market and the upcoming outlook for this rapidly changing industry.

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Had it not been for the pandemic causing a major shift in the residential and commercial real estate markets, Umansky believes we would have “already begun to see Big price correction.”

Typically, when you have dramatically low transactions, like what we saw in the 1990s, prices start to fall and “buyers start entering the market again because it’s now a value play,” he said. But due to the shortage of supply in the industry, prices did not fall much.

Sellers who held a record low mortgage rate of 3% or less during the start of the pandemic were reluctant to sell, further limiting supply and leaving few options for eager potential buyers. But high interest rates have hindered even high-net-worth transactions.

According to the agency’s report, 66.67% of agents reported that interest rates directly affect the high-end market. Umansky explained that while many wealthier clients prefer to pay in cash, they often choose to borrow against their real estate portfolios to keep their capital working for them and generate returns.

A year and a half ago, he remembers asking vendors to be patient “because there were no fish in the ocean.” He added that buyers are out there today, even though they are looking for value, which underscores how it remains a buyers’ market.

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“In 2025, there will definitely be an increase in transaction volume. Everything will start going in the right direction,” Umansky said.

He said the company believes there will be increased supply and lower interest rates, although the exact price will depend on broader economic factors.

According to the report, inventory has already increased by 66.67% in January-November 2024 compared to the same period of the previous year. Combined with increased confidence in the economy, these factors are expected to push more people into the market.

More people will be willing to move now then The election cycle has ended also.

“Historically in New York, the market freezes from mid-September to the end of November,” during election years, according to Mike Perrella, an agent with the New York agency.

“No matter who wins, 50% of the population is upset and people think the world is going to end, and then in January or February things start to go back to normal, and usually around March we will start to see the market pick up again.”

Umansky expected prices to decline in the luxury real estate market, especially with regard to final sales prices.

While ask prices may not be falling, Umansky explained that the difference between the bid price and the ask price is narrowing. Sellers are increasingly accepting offers that are closer to the offer than the original asking price.

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Because it’s a buyer’s market, sellers in 2025 “need to listen to the market” and make sure they understand the current value of their homes, according to Umansky.

If they’re not willing to sell at a specific price, Umansky advises they should consider taking their home off the market completely to avoid accumulating days on the market and becoming stale.

“If you’re not selling, you have to look at your price,” he said.