Your 2025 Mortgage Wrapped

Existing home sales rose 0.5% in November to a seasonally adjusted annual rate of 413 million homes. This marks the third consecutive monthly increase, but sales are still down 1.0% year-over-year.

Unsold inventory declined 5.9% to 1.43 million units, shrinking the supply to 4.2 months, while the median existing home sales price rose 1.2% to $409,200.

Real gross domestic product (GDP) grew at 4.3% annually in the third quarter, up from 3.8% in Q2. This beat expectations and was led by strong consumer spending, government spending and exports. This marks the strongest GDP growth in roughly 2 years despite ongoing concerns about tariffs and soft consumer sentiment.

After years of volatility, 2025 was the year mortgage rates finally found the "down" button. We started the year starting at 7% and are wrapping up December with the 30-year fixed rate hovering at approximately 5.99%. It wasn't exactly a freefall, but three consecutive Federal Reserve rate cuts between September and December provided the "vibes shift" the market desperately needed.

Home prices didn't crash, but they did stop sprinting. We saw a "Goldilocks" appreciation rate of roughly 3% to 4% nationally. While this keeps equity healthy for sellers, it allowed wages to finally start playing catch-up, slightly easing the affordability crisis that defined the previous 3 years.

2025 was the year the mortgage world finally acknowledged the gig economy. With over 36% of the workforce now earning non-traditional income, lenders pivoted toward "non-QM" loans. Instead of just looking at W-2s, banks went mainstream with bank-statement and 1099-based underwriting, allowing freelancers and creators to finally snag the keys to a front door.

Approval wait times got a massive speed boost thanks to AI. By the end of 2025, over 55% of lenders fully integrated AI-driven systems to parse documents and flag fraud. What used to take weeks of "paper-pushing" is now being handled in hours, with some platforms offering near-instant preapprovals for standard files.

Industry experts predict 2026 will be the "Year of the Refinance" for those who bought during the 2023-24 peak, with rates expected to settle steadily around the 6% benchmark.