February 7, 2025
VIDEO TRANSCRIPT:
- I’m Danielle Hale, Chief Economist at Realtor.com®. As Punxsutawney Phil suggests that winter will stick around for a bit, I’m going to cover the latest data on the U.S. labor market and mortgage rates, homeownership and housing inventory, and most importantly – tell you what it means for you. I’ll also highlight what Texas is doing right.
- It may be cold outside, but the U.S. labor market remains pretty hot. Unemployment fell to 4.0% even as the number of jobs rose by only half as much as December. More importantly, for consumers, earnings continue to rise by more than 4%.
- Even before the jobs data were released, Fed speakers this week reinforced what we learned last week. They believe that the economy is on solid footing and aren’t in a rush to cut the policy rate.
- Meanwhile, Trump’s Treasury Secretary this week noted that he and the President are focused on 10-year yields as a benchmark borrowing cost. This week, 10-year yields reached their lowest level since mid-December, and mortgage rates declined for a third straight week. Despite the declines, mortgage rates are still pretty close to 7%, and likely acting as more of a headwind than tailwind for home shoppers.
- Homeownership rates remained high at the end of 2024 overall. Digging in deeper, however, we see that homeownership rates slipped for younger households, a sign of how challenging the market has become for first-time buyers amid a decade-long housing shortage. In fact, the homeownership rate for age 35 and under fell to the lowest level since before the pandemic.
- Realtor.com weekly housing data point to difficulties for buyers, too. For-sale homes this week spent more time on market even as asking prices remain below their year-ago level. Of note, new listings growth pulled back from its recent pace, which suggests some easing of home sales is likely ahead.
- Finally, in conjunction with the relocation of Realtor.com headquarters to Austin, my team took a look at what the Lone Star state is doing that has attracted residents and businesses like ours to the area. Movers to Texas from California–the top domestic source–cited its affordable housing, jobs, and climate as major motivators.
- You can find all the details, including full reports and our housing data for download, at realtor.com/research. You can also follow us on X (formerly twitter) for real time updates. And instagram for graphics.
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