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- 6 Predictions for the 2025 Real Estate Industries
Let’s be honest: 2024 wasn’t the great revival we all hoped for. With climbing home prices, high mortgage rates and limited inventory, the housing market remained slow.
Yet, through it all, the SoftPro team has greatly admired the resilience, ingenuity and adaptability of real estate and title professionals. You navigated these challenges head-on. While we’re experts in closing production software, we’re also active members of the real estate community. We've been watching the 2025 forecasts closely and assessing what they mean for our team and customers. While we don’t have a crystal ball, we think it might be time for cautious optimism heading into the new year.
With that, here are six predictions for the 2025 housing and title industry worlds.
1. Mortgage Rates Will Be Choppy
First, some bad news. While we were all hoping that the Federal Reserve’s interest rate cuts would lead to a corresponding drop in mortgage rates, that hasn’t exactly been the case. Instead, 2025 is shaping up to be another year of unpredictable swings. Some experts believe rates will hover between 5.75% and 7.25%, with periodic short-term dips.
Of course, we saw this play out in 2024: rates dipped to around 6.1% during the summer, briefly boosting home sales, but climbed back near 7% by year’s end, which again cooled activity. Expect a similar rollercoaster this year. Lower rates will open brief windows of opportunity for potential buyers looking to purchase and homeowners looking to refinance, while higher rates may keep some on the sidelines for stretches.
2. Inventory Will Rise... Slowly
It seems like we’ve been experiencing an inventory crunch for as long as we can remember, but the tide is finally shifting—just not quickly. By the end of 2024, available homes for sale were 27% higher than the previous year. Most markets across the country now have more inventory compared to late 2023, with a few states, particularly in the South and West, having more homes for sale now than they have in almost a decade.
Still, this isn’t a flood of new listings—inventory remains below pre-pandemic levels from 2018. A mix of factors, including high mortgage rates and the “lock-in effect,” has kept many sellers on the sidelines. Homeowners who bought or refinanced into 2% or 3% mortgage rates are understandably hesitant to trade up to a higher rate, even if they’d like to move.
Still, experts predict inventory will rise modestly again in 2025. This gradual buildup will give buyers a bit more breathing room but won’t tip the market into oversupply. For the real estate market, it’s a step toward the “old normal”—a slow, steady return rather than a sudden reset.
3. Home Prices Will Grow More Modestly
Home prices are expected to rise 2% to 2.6% in 2025. That’s a much slower and more manageable pace compared to the rapid gains of recent years. For context, home prices jumped by double digits during the pandemic boom, driven by low mortgage rates and intense buyer competition. Buyers will benefit from a market that’s gradually gaining its footing. Sellers, meanwhile, can still expect home values to inch upward, though without the bidding wars and price spikes that defined the last few years.
The slower appreciation reflects a cooling housing market that’s settling into a healthier balance. While demand remains steady, growing inventory and cautious buyer behavior will help keep prices in check. Overall, 2025’s price growth signals a calmer, more sustainable trajectory for home values, which is good for everyone.
4. The Title Waiver Pilot May Get Scrapped
This may be wishful thinking, but many industry insiders believe the controversial FHFA title waiver pilot will be off the table in 2025. This program, which aimed to eliminate lender’s title insurance on certain low-risk refinances, has been a hot topic of conversation all of 2024. While the Biden administration pitched it as a way to save homeowners a few hundred dollars at closing, the trade-off raised serious concerns about the loss of critical protection for lenders and borrowers alike.
The American Land Title Association (ALTA), alongside other industry leaders, has been vocal in opposing the plan. Its message has been clear: the “perceived” savings don’t justify the risks. ALTA called the pilot a “false promise of savings,” arguing it does little to solve broader affordability issues and largely benefits wealthier homeowners.
With a new administration coming in, many expect the waiver to be abandoned. President-elect Trump’s preference for free-market solutions and expected leadership changes at the FHFA make it unlikely the program will move forward. While nothing is certain yet, title professionals can perhaps breathe a little easier.
4. Fraud Will Rise to New Heights
The more things change, the more they stay the same, unfortunately. And while we may hopefully wave goodbye to one unwelcome new threat, another isn’t going anywhere: fraud.
Fraud in the real estate and title industry is expected to hit new heights in 2025, driven by increasingly aggressive and sophisticated cybercriminals. Business Email Compromise (BEC) remains one of the biggest threats, with losses reaching $2.9 billion in 2023—and that’s just what’s reported. We also saw a 42% increase in these scams in the first half of 2024 compared to the same period in 2023. Meanwhile, seller impersonation fraud is growing, particularly for vacant or rental properties, where fraudsters pose as owners to sell homes they don’t actually own.
Additionally, while the industry’s shift to digital closings has brought speed and efficiency, it’s also introduced new vulnerabilities. Staying ahead of fraud in 2025 will require ongoing vigilance, more education, cutting-edge tools and industry-wide collaboration. Title professionals have been engaged in this battle for a long time—and it’s clear the fight is far from over. SoftPro is committed to being a partner in fighting this battle with SoftPro 360 integrations, such as agentTRAX with its ionFraud tool, to help combat seller impersonation.
4. AI Will Continue to Change How We Work
Since generative AI hit the mainstream just a few years ago, it’s become one of the most exciting—and scariest—breakthroughs in years. The title industry is no exception to feeling the effects. Some professionals are energized by AI’s potential to revolutionize how we work, while others are nervous, and for good reason.
We’re already seeing AI tools help streamline time-consuming tasks like data entry, document review and communication. Many are hopeful that AI will help tackle even bigger challenges over the next year. But, as we discussed earlier, fraudsters are also evolving and looking for ways to exploit this very same technology. Add in concerns around privacy, misinformation and security, and it’s clear there’s still work to do.
What’s the best thing you can do? Stay informed and start experimenting. AI isn’t going anywhere, and the more you understand it, the better prepared you’ll be to use it responsibly and effectively. If you’re looking for a place to start, check out our two-part blog series on AI—your guide to understanding how this technology is reshaping the industry and how you can make the most of it.
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The Bottom Line
While 2025 may see a return to normalcy in many ways, we know you will still face many challenges, obstacles and decisions, no matter what happens going forward. That’s why it’s more important than ever to choose the right partners for your operation. SoftPro is grateful for the trust of our customers, and we remain committed to providing easy-to-use, evolving software to fit your needs. Whether you're with a large company or small business, we design our customizable solutions with you in mind.
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