Redfin CEO: These 10 shifts will define real estate in 2025

As we approach 2026, I’m thinking about a turning point in the history of American real estate. Here is my list of the top 10 trends for 2025.

10 trends that will shape real estate in 2025

1. The market shifted to buyers

Since recovering from the Great Recession of 2008, the US housing market has favored sellers. But 2025 was the year buyers were finally backing away from rising home prices.

Comparing home sales in the first quarter of 2024 to home sales in the first quarter of 2025, the average number of days a home was on the market increased from 47 to 54, a modest but still significant shift.

Prices are now likely to grow slower than inflation, which is not only good for first-time buyers, but also for the sector. The sales volume correction will only end when there is a meaningful correction in house prices.

2. Affordability became a national political issue

2025 has also been the year that affordability became a prominent national issue, leading to sweeping political changes from Seattle Unpleasant New Yorkand a broad new mandate within the Trump administration.

Of the many goods that Americans found difficult to afford, housing was number 1. For the first time, the average age of the first home buyer crossed a crucial psychological thresholdThis means that Americans will spend more than half their lives chasing the American dream. The good news is that there is now broad consensus that this needs to change.

3. The industry has shaken off rule changes

In March 2024, the National Association of Realtors paid $418 million to settle a class action lawsuit in Missouri on behalf of home sellers who do not want to be required to pay a commission to the buyer’s agent.

The media predicted the “elimination [of] a foundation of the industry, the standard sales commission of 6 percent.” Since then commissions have increased slightly.

By limiting agents’ ability to participate in commissions, the lawsuit also made it easier for agents to withhold listings from public marketplaces. This gave buyer’s agents the right to charge more instead of less.

4. Goodbye, Mom and Dad. Hello larger stores

2025 has been a year of consolidation. Rocket bought Redfin and Mr. Cooper. Compass later entered into a deal to buy Anywhere, the largest U.S. brokerage.

One factor has been more business-friendly governance, and a second has been a prolonged recession in the housing market, which has put pressure on companies with smaller balance sheets, especially as real estate portals spend more than half a billion dollars on advertising each year.

The rise of AI also benefits larger companies with more data. A traditional industry of mortgage lenders and real estate agents that no longer has malls and home offices is now favoring larger, more innovative companies.

5. AI-adapted real estate agents

After decades of only incremental innovations in the way people search for homes, 2025 was the year that artificial intelligence broke through. AI imagined and created new neighborhoods for homebuyers to explore or how much they could offer for a home look for experiences that feel like a conversation.

AI gave portals the power to improve not only the initial home search, but also the actual services provided by the real estate agents affiliated with those sites. A site like Redfin or Zillow now asks real estate agents to contact a customer who gave up her search and came back or who started looking at the same listing repeatedly.

Portals that have accounted for nearly 100 percent of online searches but whose agents have handled less than 10 percent of all U.S. home sales are finally expanding their reach to include the transaction itself.

6. The economy of 1099 came under pressure

Pandemic-era stimulus checks gave many Americans the reserves to strike out on their own as real estate agents, to the point that as of 2021, the number of U.S. agents exceeded the number of homes for sale.

But as 2025 drew to a close, it became clear that government subsidies for health insurance for gig workers were coming to an end. Many real estate agents get insurance through their spouse, but others are now considering alternative careers.

7. Peak Texas

Ten years ago this blog predicted a mass migration to Texas. From 2018 to 2022, home prices in a boomtown like Austin increased by more than 50 percent. Since then, prices have fallen by almost 20 percent. In 2025, people looking for low home prices and low taxes moved to the Midwest, not Texas or Florida.

8. The Fed fought for independence

2025 will go down in history as the year the Federal Reserve fought for and maintained its independence, keeping mortgage rates above 6 percent for longer than many expected. The short-term effect was a decline in home sales. The long-term effect of a more credible Fed is lower inflation and less volatility in the housing market.

9. YIMBYism became a broader political movement

The yes-in-my-backyard movement that began supporting more housing construction became a broader political idea in 2025. The leader of the effort to reform America’s left wing from within, Ezra Klein, published his book Abundance in March of this year, arguing that American progressives should set aside regulations to build infrastructure far beyond homes, such as public transportation and next-generation power plants.

10. Law: the Hundred Years’ War

The rise of real estate powerhouses has created a new competitive front in an industry that has long prided itself on resolving its own disputes through negotiation and cooperation.

Lawsuits between CoStar, Zillow and others are the new norm, in battles that will likely last years, not months. Industry titans who once endorsed the National Association of Realtors’ lobbying efforts now employ their own government affairs teams. Once an industry starts fighting this way, it rarely stops.

Glenn Kelman is the CEO of Redfina technology-driven real estate agent.