The defining theme for 2025 is stability. With the Federal Reserve likely pausing interest rate hikes, the worst-case scenario appears to be maintaining current rates. While we’re not returning to the booming market of 2021, this stability should be welcomed by all market participants as it reduces volatility and allows for better planning. Buyers, sellers, renters, and investors alike can benefit from a more predictable market environment.
Buyers
Many buyers paused their plans in anticipation of the election. With the election now behind us, we have a clearer vision of policy direction for the next four years. For first-time homebuyers, stable interest rates are a game changer, offering consistency in monthly payments.
Additionally, a more robust market could lead to increased housing supply. Many sellers and builders deferred their plans due to uncertainty around policy changes. If stability holds, 2025 could see a surge in available inventory. Having more options is always advantageous for buyers, creating opportunities for better negotiations and favorable terms.
Sellers
For sellers, 2025 offers the prospect of more active buyers in the market. Over the past year, Nashville has experienced a stalemate: buyers hesitated due to volatility, and sellers, benefiting from historically low mortgage rates, chose to hold onto their properties despite wanting to upgrade.
However, life events continue to drive the need for moves, and for those who’ve postponed selling, now may be the time. A balanced market—with both buyers and sellers participating—can stabilize prices and create equilibrium. Although Nashville still faces a supply shortage, particularly in the urban core, this balance should provide much-needed stability to pricing.
Investors
For investors, market unpredictability has been a challenge. Extended days on the market and hesitant buyers led many to pause activity. These conditions made it difficult to create accurate pro formats, a critical tool for assessing investment potential.
With stability on the horizon, variables like holding costs and days on the market are expected to normalize, allowing investors to make more precise calculations during due diligence. Stable conditions reduce risk and allow for better-informed decisions, making 2025 a potentially strong year for investment activity.
Renters
Renters could see some relief in 2025. A wave of multifamily housing projects, many financed during earlier periods of lower interest rates, is now entering the market. This influx of supply could create competitive pricing.
As developers work to stabilize these properties, renters may find deals, particularly as some choose to transition from renting to buying. This shift, coupled with increased supply, could lead to modest price reductions in the rental market.
Nashville Perspective
2025 holds significant promise for Nashville. In addition to the market stability discussed above, the city is expected to complete its infrastructure study related to the Nashville NEST bill. Originally introduced in 2023/2024 to address the city’s affordability crisis, the bill was postponed for further research.
With the study’s completion, the city can fine-tune its approach to affordability and strategically plan for increased housing supply. If implemented effectively, this could mark the beginning of meaningful relief for Nashville’s housing market.
Stability brings opportunity. Whether you’re buying your first home, selling an existing property, investing in real estate, or renting, 2025 offers a more predictable and balanced market. For Nashville, this could be a pivotal year in addressing affordability and creating sustainable growth. With thoughtful planning and a focus on long-term goals, the upcoming year may prove to be a welcome reset for the real estate market.
Adam Myers is currently the broker/owner of Ten Cap Real Estate Group. He works closely with builders and investors to leverage assets in real estate, as well as educate buyers new to the market on how to make sound investments. He’s also the owner of MyersCo., a development and construction firm that specializes in infill development.
