Housing Market and Interest Rates Update

Why Relief May Be on the Horizon for Homebuyers and Relocation Programs

The real estate market has endured a long stretch of sluggish activity, but encouraging signs are emerging. In a recent webinar hosted by Guaranteed Rate Affinity, Dr. Lawrence Yun, Chief Economist at the National Association of REALTORS®, offered a cautiously optimistic outlook on what’s ahead—and what it means for both individuals and companies navigating relocations.

At InterLink Relocation Resources, we keep a close pulse on housing market trends to better support our clients’ global mobility programs. Here are key highlights and takeaways from Dr. Yun’s March 19 discussion following the Federal Reserve’s latest announcement on interest rates:

📈 Job Market Strength Signals Pent-Up Housing Demand

Despite recent slowdowns in home sales, the U.S. job market continues to hit record highs—an important foundation for future home buying activity. According to Dr. Yun, today’s housing market is experiencing the lowest sales volume in 30 years, even as the U.S. population has grown by over 80 million people since then. This gap suggests a significant amount of pent-up demand that could be released once mortgage rates ease and more home inventory becomes available.

🏘️ Inventory is Starting to Loosen

One major barrier to transactions has been the so-called “lock-in effect”—homeowners holding onto ultra-low mortgage rates from past years and reluctant to sell. But that trend is beginning to shift. Dr. Yun notes that life events, growing mobility needs, and a slowly improving inventory outlook are prompting more homeowners to list their properties. Builders, meanwhile, have continued to add supply and are seeing stronger sales as a result.

For companies relocating employees, this means a potentially wider range of housing options could become available throughout 2025.

💼 Why Capital Gains Tax Reform Matters

Interestingly, a large segment of potential sellers—those who own their homes free and clear—are hesitant to move due to capital gains tax concerns. NAR is advocating for inflation-indexed capital gains exemptions, which would allow long-time homeowners to sell without being penalized by outdated tax thresholds.

This policy shift, if enacted, could encourage even more inventory to enter the market—welcome news for relocation programs seeking cost-effective housing solutions.

🏦 Mortgage Rates: What’s Next?

Mortgage rates have stayed elevated even after multiple Federal Reserve rate cuts, largely due to persistent inflation. However, inflation is trending downward, and mortgage rates are expected to gradually decline, potentially settling near 6% in the second half of 2025.

Still, Dr. Yun cautions that high national debt levels may keep rates from falling significantly further. For mobility and relocation managers, timing will be critical—the second half of the year may offer better conditions for home purchase and selling activity.

🧭 What It Means for Talent Mobility & Relocation

• More movement is coming. The combination of job growth, early signs of inventory increases, and declining rates point to a more active housing market in the months ahead.
• Flexibility remains key. High-end properties are seeing more movement than entry-level homes, so being open to a range of housing options will benefit relocation success.
• Education matters. As always, employee expectations need to be aligned with current market realities. Data like equity gains, long-term wealth building, and regional trends can help frame the big picture for relocating talent.

Conclusion: Dr. Yun believes the worst of the housing market slump is over. With inventory increasing, jobs strong, and rates poised to decline, 2025 could bring notable improvements in home sales. However, affordability challenges and policy impacts will continue to play a critical role in shaping the market.

🌐 InterLink’s Perspective

At InterLink, we help clients navigate complex housing markets every day. Whether you’re managing domestic relocations, global assignments, or group moves, our team is ready with personalized support, real-time data, and flexible housing strategies.

The market is shifting—and that means new opportunities for companies focused on smart, effective talent mobility.

Managing your relocation program in-house? Let’s explore how you can simplify the process, expand housing options, and improve employee experiences—all while controlling costs. With over 35 years of relocation and temporary housing expertise, InterLink delivers proven solutions backed by personalized service and real-time insight.

Call us at 866-254-3910 or email info@interlinkrelocation.com to start the conversation.