Expert Forecasts for North Idaho’s 2025 Housing Market

As we head into 2025, the housing market continues to be a hot topic of discussion, particularly in rapidly growing regions like North Idaho. Whether you’re considering buying your first home, upgrading to a larger property, or selling in a sought-after area, understanding the latest trends is crucial. Experts frequently revise their forecasts to reflect economic shifts and market dynamics, so staying informed is key.

Here’s what North Idaho residents and prospective homebuyers need to know about two major factors shaping the housing market this year: mortgage rates and home prices.

Will Mortgage Rates Come Down in 2025?

One of the most significant drivers of the housing market is mortgage rates, and for many buyers, the question remains: Will they finally come down this year? The answer is cautiously optimistic. While a return to the historically low rates of 3-4% seems unlikely, experts forecast some easing in 2025, with rates potentially settling in the mid-to-low 6% range.

As Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), puts it:
"Are we going to go back to 4%? Per my forecast, unfortunately, we will not. It’s more likely that we’ll go back to 6%."

For buyers in North Idaho, even a small dip in rates can make a big difference. The region has seen increasing demand due to its scenic beauty, outdoor lifestyle, and relatively affordable housing compared to nearby urban centers like Seattle. Lower mortgage rates could ease monthly payments and open doors for more buyers to enter the market.

However, it’s important to remember that mortgage rate forecasts depend on various factors, including inflation, Federal Reserve policies, and broader economic conditions. While the overall trend looks promising, expect some fluctuations throughout the year. To navigate these changes, work closely with a trusted lender and real estate agent who can provide up-to-date information and personalized advice.

Will North Idaho Home Prices Fall?

If you’re hoping for a drop in home prices to snag a bargain in 2025, the outlook suggests otherwise. In North Idaho, as in much of the country, home prices are projected to continue rising, albeit at a slower and more sustainable pace than in recent years.

On average, experts predict national home prices to increase by about 3% this year. While this might sound modest, it represents a return to normalcy after the dramatic price surges seen during the pandemic-era housing boom. For North Idaho, where demand has consistently outpaced supply, price increases could be slightly higher. Towns like Coeur d’Alene, Sandpoint, and Post Falls remain highly desirable, driving competition among buyers.

Why Are Prices Still Rising?

The key driver behind rising home prices in North Idaho is the classic economic principle of supply and demand. While the number of homes for sale has grown compared to last year, inventory remains tight. Many potential sellers are holding onto their homes, reluctant to give up the low mortgage rates they secured in prior years.

Meanwhile, North Idaho’s appeal as a destination for outdoor enthusiasts, retirees, and remote workers continues to attract new residents. The region offers a unique blend of small-town charm, pristine lakes, and proximity to national forests—all of which make it a magnet for buyers willing to pay a premium.

As Redfin explains:
"Prices will rise at a pace similar to that of the second half of 2024 because we don’t expect there to be enough new inventory to meet demand."

The Hyper-Local Nature of North Idaho’s Market

While national trends provide valuable context, it’s essential to remember that real estate is hyper-local. Different areas of North Idaho may experience varied market conditions:

• Coeur d’Alene: Known for its vibrant downtown and proximity to Lake Coeur d’Alene, this city continues to see high demand and limited inventory, keeping prices on an upward trajectory.
• Sandpoint: This charming mountain town remains a favorite for outdoor enthusiasts and second-home buyers, with prices rising steadily as inventory struggles to keep pace.
• Post Falls: Offering more affordable options compared to Coeur d’Alene, Post Falls is growing rapidly, appealing to families and first-time buyers.
• Rural Areas: Smaller towns and rural properties may see slower price growth or stabilization, especially if they’re farther from amenities and job centers.

If you’re buying or selling in 2025, working with a local real estate expert is crucial. They can provide insights into your neighborhood’s specific trends and help you make informed decisions.

What 2025 Means for North Idaho Homebuyers and Sellers

The housing market in North Idaho is poised for a dynamic year. With mortgage rates expected to ease slightly and home prices continuing to rise at a more moderate pace, it’s all about careful planning and staying informed.

For buyers, this means focusing on affordability and working with trusted professionals to explore options that align with your budget. For sellers, it’s an excellent time to capitalize on North Idaho’s high demand while ensuring your property is competitively priced.

Reach out to on of our North Idaho real estate professionals with Garnet Real Estate Group today to get personalized advice, local market insights, and a plan tailored to your unique needs. Whether you’re buying or selling, 2025 could be the perfect year to make your move.