The Mortgage Reports : Today's Mortgage Rates & Strategy Sponsored Content
Many home buyers (and prospective home buyers) struggled through the low affordability and high mortgage rates of 2024’s housing market.
Plenty bided their time, waiting for improved conditions. The second quarter of 2025 comes with increased for-sale inventory, anticipated declines in interest rates and home price growth, as well as emerging cities for first-time buyers and best metro areas for Gen Z.
Preparing yourself and finding good advice also ease the homeownership journey. To help, The Mortgage Reports spoke with industry experts to see what first-time home buyer guidance they have heading into Spring 2025.
Verify your home buying eligibility. Start here
In this article (Skip to…)
Expert advice for first-time home buyers
The housing market can be a tough and sometimes confusing place to navigate — especially for first-time buyers. Home buying conditions are in a constant state of flux, shifting over time and by geography.
To shed some light and (hopefully) make matters easier, The Mortgage Reports got insights from experts in the field to help borrowers in 2025’s second quarter. Answers have been edited for brevity and clarity.
What is special or unique about the current home buying marketplace?
Ralph DiBugnara, president at Home Qualified:
What makes today’s real estate market different is the fact that it’s not necessarily a buyer’s or a seller’s market. It’s not advantageous to buyers because of high interest rates and lack of homes for sale. But at the same time, low affordability has fewer buyers looking so sellers don’t have a definitive advantage and may still have to compromise to find the right buyer.
See what interest rate you qualify for. Start here
Hannah Jones, senior economic research analyst at Realtor.com:
Today’s market is an interesting mix of buyer- and seller-friendly conditions. For-sale inventory is up 28.5% year-over-year in March, but still well below pre-pandemic levels. This means that buyers are in a good position relative to the last few years, but still-limited inventory has kept home prices high. Both buyers and sellers must clear the hurdle of high-6% mortgage rates as well, which keeps sellers with low-rate mortgages ‘locked-in’ and limits home much home buyers can afford.
Rick Sharga, CEO at CJ Patrick Company:
There are a number of unique variables at play in the current home buying marketplace. There’s an extremely limited supply of homes available for sale in some parts of the country, like the Northeast and Midwest, making it hard for buyers to find something to buy, and making whatever is available more expensive. Gulf Coast states – especially parts of Florida and Texas – probably have a bit too much supply for current demand, and are actually seeing prices decline year-over-year in some places. So understanding local sales and pricing trends is critical.
A growing issue for buyers is the soaring cost of homeowner’s insurance, which is up over 70% in the past decade according to a Harvard study, and has doubled and even tripled in markets that have been hard hit by extreme weather events. Historically, insurance costs weren’t factored into a borrower’s ability to afford a property; but in today’s market, buyers really need to consider those costs – both at the time of purchase, and what it might cost in the future.
Sam Williamson, senior economist at First American:
Recent trends suggest that the housing market may be entering the early stages of a mild recovery ahead of the spring home-buying season. Housing inventory is rising, and in pockets of the country where homes are sitting, sellers have started to cut prices. All else held equal, this could help ease price pressures and draw potential buyers into the market. Overall, these shifts point to the housing market showing greater flexibility, creating opportunities for attentive and well-prepared buyers.
Diane Yu, co-founder and CEO at Tidalwave:
The present home buying market is marked by significant challenges, including high mortgage rates and economic instability. First-time mortgage seekers encounter extended processing times, substantial origination costs, and manual errors that lead to delays. Millennials and Gen Z, used to digital convenience, find traditional mortgage processes cumbersome and inefficient. Language barriers further complicate matters, affecting a considerable portion of Hispanic Americans. To address these challenges, innovative AI solutions such as TidalWave are emerging, providing customers with faster guidance and multilingual support throughout the process.
Is the second quarter a safe/smart time to buy a home given the governmental turmoil and uncertainty?
DiBugnara: In the second quarter of 2025, we should see a gradual decline in interest rates and an uptick in buyer activity as the market transitions into spring. I believe it’s inevitable that mortgage rates will eventually come down. When that happens—whether this year or next—home prices are likely to rise again. What makes the second quarter a smart time to buy is that the home will almost certainly be worth more in the future.
Jones: Trying to time the market is a challenge for even the most tuned-in buyers. It is very reasonable that buyers may feel hesitant to make a significant financial decision while the path forward feels uncertain. However, home shoppers can prepare to be successful by making sure they are looking at homes that fit very comfortably in their budget. If the right house comes onto the market at the right price, buyers can feel confident moving forward with a home purchase.
Verify your home buying eligibility. Start here
Sharga: In terms of buying a home during a time of governmental (and economic) uncertainty, buyers should really focus on their personal situation more than what’s going on in Washington, and on their long term plans. While governmental policies may roil the financial markets, what a buyer needs to consider is whether that upheaval will impact their ability to stay employed, and earn the income they need to make home payments. Waiting for Washington to get fiscal policy exactly right before buying a house is essentially deciding to be a renter forever. Along those lines, government policies can change pretty dramatically every four years, and may have an impact on home prices, and home sales. So buyers really need to approach a purchase with a longer time horizon: home prices historically have gone up over time – sometimes they dip a bit, but then recover and go up again. So buying a house shouldn’t be a short-term consideration for most homeowners, but a longer-term commitment, which will allow most owners to weather temporary economic fluctuations.
Williamson: The second quarter can still be a good time to buy a home, as early indicators suggest the market may be becoming more buyer-friendly. However, trying to time the market is less relevant than a home buyer’s lifestyle needs and financial readiness. Purchasing a home is a major financial decision that requires thoughtful planning and evaluation. It’s always important for home buyers, particularly first-time buyers, to assess their financial readiness and lifestyle needs. If you’re financially prepared and buying a home aligns with your lifestyle goals, then it could be the right time for you to purchase.
Yu: While mortgage rates have come down from their peak in late 2023, they are still high. Purchasing a home now could be a good decision if your credit score is strong, your job is secure, and you have enough savings for a down payment and closing costs. On the other hand, if your personal finances are not in the best shape or home values in your area are decreasing, it might be wise to hold off. The advice is clear: if you find a home you want, act on it. Trying to time the market is futile, and a home purchase should be viewed as a long-term investment.
What’s the top piece of advice you’d give first-time home buyers in 2025’s second quarter?
DiBugnara: My best advice for first-time homebuyers in today’s market is to be patient and have a budget that they have to stick to. Most first-time homebuyers can afford less in today’s market because of high mortgage rates and increased cost of goods. With that being the case, you don’t want to overextend and reach for a home you don’t really love. At the same time, it’s important to compromise and have some vision when you’re buying your home in today’s market because you can make improvements over time.
Jones: Buying a home in today’s market means contending with high prices and elevated mortgage rates. First-time buyers should run the numbers to be sure they can comfortably afford a home. It is more affordable to rent than to buy a home in most large U.S. metros, which means that renters are in a good position to keep saving for a down payment until the time is right to purchase a home.
Verify your home buying eligibility. Start here
Sharga: If you’re ready for the financial commitment that comes with homeownership, and the time commitment that it might take for homeownership to pay off financially, then buy when you find a home that you like, that meets your needs, and that you can reasonably afford. Don’t let short-term gyrations knock you off course for your long-term goals.
Williamson: If the market continues to shift in favor of buyers, first-time home buyers may have greater leverage to negotiate than in recent years. Buyers should face less pressure to escalate prices to win bids, have more time to make decisions, and may be in a better position to negotiate. Additionally, potential buyers may consider purchasing a new construction home. New homes can offer several advantages over existing homes in today’s market. The price premium between new and existing homes has decreased, making new homes more accessible. Also, in this higher-for-longer rate environment, builders can offer mortgage rate buydowns, making monthly payments more manageable, and offer upgrades on interior design features and appliances.
Yu: AI is known for making things simpler, and it can do the same for mortgages. Currently, the mortgage process is still complicated by excessive paperwork and long delays, which can be confusing for applicants. First-time homebuyers can greatly benefit from lenders who use AI to automate documents and provide 24/7 chatbot support, resulting in a more accessible and understandable experience.
The bottom line
Buying your first home could be as daunting as it is exciting. But preparing yourself and heeding advice from professionals can help you navigate the housing market.
If you’re ready to begin your path to homeownership, find a local lender and real estate professional you trust to get started.
Time to make a move? Let us find the right mortgage for you
