Trust This. Housing Trends: Sales Rebound – Prices Rise

Home Sales Recovery: Transaction volume is projected to rebound from 2024’s decade-low 4 million sales, driven by easing mortgage rates and increased inventory. This growth aligns with a historical trend of gradual recovery post-downturns but remains far below pre-pandemic highs.

Inventory Surge: Inventory levels are forecasted to grow by 13%, with 800,000 unsold homes expected by October 2025. This shift could ease competition among buyers, tempering price increases.

Price Trends: Despite demand pressures, downside price risks are mitigated by “downside stickiness,” where sellers resist lowering prices even in weak markets. The 3.5% appreciation forecast exceeds the average industry estimate of 2.6%.

Affordability Crunch: With mortgage rates significantly impacting affordability, housing’s price-to-income ratio remains a red flag, exacerbating access for new buyers.

Inventory growth may unlock new transaction possibilities, while rising prices could benefit long-term investors.

However, affordability constraints and fluctuating interest rates could dampen activity in competitive Sun Belt markets like Florida.

Similarly, U.S. Department of Veterans Affairs (VA) loans have seen an uptick, though their rate of increase is slower than FHA loans.

Factors include economic pressures, rising insurance and tax costs, and lingering effects from natural disasters like hurricanes Helene and Milton.

FHA borrowers transitioning from COVID-19 forbearance plans are vulnerable, with re-default rates for modified loans exceeding 50%.

Rising homeownership costs—property taxes and insurance now make up 33% of mortgage payments—further strain borrowers.

The financial stress is exacerbated in disaster-prone areas, with hurricanes causing delinquency spikes.

This trend could escalate if unemployment increases, as forecasted to reach 4.7% next year.

While current delinquency rates are historically low, the upward trend signals potential risks and opportunities for real estate investors and professionals.

For investors, distressed properties may become more accessible, creating opportunities for acquisitions and value-add strategies.

Additionally, portfolios with delinquent loans can be transitioned to specialized servicing companies to reduce losses.

Grant encourages adopting a scientist mindset: hypothesize, test, and revise. Small business owners often fall into the “preacher, prosecutor, or politician” trap—defending beliefs, attacking opposing views, or seeking approval rather than evidence.

Example: Instead of assuming a marketing strategy will work because it’s always worked, treat it as a testable hypothesis. Measure results and iterate.

Confident humility is about balancing self-belief with openness to new ideas. Many entrepreneurs fear changing direction might appear weak. Admitting gaps in knowledge shows strength and builds trust.

Tip: Seek feedback from employees, customers, and mentors. Honest conversations can illuminate blind spots.

Entrepreneurs often tie their personal identity to their business strategies, making it hard to pivot when needed. Grant warns this leads to stagnation.

Shift your mindset: Your ideas are tools, not trophies. If a tool doesn’t work, switch it out.

Schedule “rethinking sessions” to evaluate business assumptions quarterly.

Create a team culture where challenging the status quo is celebrated.

Foster curiosity by reading, attending industry events, or joining mastermind groups.

Adopting a rethinking mindset isn’t just about survival; it’s about unlocking your full entrepreneurial potential.

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