Real Estate on the Brink: Why 2025's Market Shift Makes Now the Best Time to Buy or Sell

The real estate market is no stranger to change—but 2025 is shaping up to bring a perfect storm of price increases, inventory shortages, and construction delays that could make today’s conditions look like a golden opportunity in hindsight. With new tariffs on imported building materials, nationwide labor shortages, and housing affordability at a critical point, the signs are clear:

Buyers and sellers who act now will be in the best position to benefit—before these changes hit full force.

In this article, we’ll break down how upcoming economic pressures are expected to reshape the housing market—and why you should take action now, not later.

Tariffs Will Push Prices Higher—Fast

According to sources including NBC News, AdMortgage.com, and AmericanHomeBuyer.us, tariffs on imported building materials are set to increase the cost of constructing a new home by $7,500 to $10,000. These tariffs will affect materials like lumber, steel, aluminum, and drywall—essential components in virtually every new build.

How does this affect you?

If you're a buyer: New home prices will jump, and even existing homes will rise in value due to tighter supply and increased demand.
If you're a seller: Buyers will want to get ahead of price increases, which means more urgency and stronger offers—now.

Rising Construction Costs Are Just the Beginning

As reported by MultiHousingNews.com, building costs are already 30% to 50% higher than they were just a few years ago due to inflation and supply chain disruptions. The new tariffs will only pour gasoline on that fire.

And it’s not just materials—insurance costs for new developments are also increasing, especially in areas prone to wildfires, flooding, and severe storms. As the cost of building skyrockets, developers may delay or cancel projects altogether.

Result: Fewer homes. More competition. Rising prices.

Labor Shortages Will Slow Down Housing Starts

It’s not just materials—there’s also a labor crisis looming. The Urban Institute estimates that 1.7 to 1.8 million undocumented workers in the construction industry may be deported or otherwise displaced, creating a major labor shortage.

That’s bad news for new housing developments already struggling to keep up with demand. Fewer workers mean longer construction timelines, higher labor costs, and delays in new home inventory hitting the market.

Translation: Buyers will have fewer choices and face higher prices. Sellers will benefit from less competition.

A Market Cooldown Is Inevitable—But It's Not Here Yet

As affordability worsens, mortgage rates fluctuate, and inventory tightens, economists are warning of a possible housing market slowdown in late 2025 or 2026.

While that may sound like a reason to wait, it’s actually the opposite.

Buyers should move now while interest rates are still favorable and before prices climb higher.
Sellers should capitalize on strong buyer demand and avoid listing during a potential future downturn.

Waiting could mean buying at a higher price or selling into a slower market.

Expert Insights: What the Data Says

A few key takeaways from recent research:

Homebuilders are pulling back. With costs rising and margins shrinking, many developers are slowing production. That means less new inventory coming soon.
Demand remains strong. Millennials are entering peak home-buying years, and Gen Z isn’t far behind. There are more people who want homes than homes available.
Interest rates are a wild card. While they've come down from recent highs, uncertainty around inflation and Fed policy means buyers should lock in rates when they’re favorable.

What This Means for You

If You’re a Buyer:

Lock in pricing before tariffs push costs higher
Avoid future bidding wars caused by shrinking inventory
Secure a lower interest rate before potential increases
Choose from a wider selection of homes while inventory is still reasonable

If You’re a Seller:

List while demand is high, and buyers are eager
Get stronger offers before affordability becomes a barrier
Move into your next home before prices surge even higher
Stand out with less competition from new construction

Final Thoughts: Timing Is Everything

The housing market is on the edge of major shifts—and those who wait could end up paying more, getting less, or both.

Whether you’re buying your first home, upgrading, downsizing, or investing, now is the time to act.

Don’t wait for prices to climb, inventory to vanish, or market momentum to shift. The smartest move is to get ahead of these changes—while you still can.

📞 Ready to Make Your Move?

Let’s talk strategy. Whether you're looking to buy, sell, or just understand your options, I’m here to guide you through the process and help you make the most of this unique market window.