Top Real Estate Trends to Watch in 2025: What Buyers, Sellers & Investors Need to Know

by Jeff Hernandez

The real estate market in 2025 is shaping up to be one of evolution and adaptation. With new demographics entering the industry, market shifts in mid-sized cities, and increasing technological integration, real estate professionals, investors, and homeowners must stay ahead of these emerging trends to make informed decisions.

From the rise of Gen Z in real estate to changing investment strategies and policy shifts, here’s what to watch for in 2025’s real estate market.

1. The Rise of Gen Z in Real Estate

A new wave of young professionals is entering the real estate industry. In 2024, the percentage of Realtors under 30 quadrupled, growing from 1% to 4%. Many Gen Z agents and investors are drawn to the industry for financial independence and entrepreneurial opportunities, despite facing skepticism due to their age.

As this generation expands its footprint in the market, expect to see fresh perspectives, innovative marketing strategies, and a shift toward digital-first real estate practices.

2. Mid-Sized Cities Are Becoming Real Estate Hotspots

With high housing costs in major cities, real estate investors are turning to mid-sized markets for better returns. Louisville, Kentucky, for example, has gained popularity due to its affordable home prices, economic stability, and presence of major corporations.

These smaller cities offer steady, long-term investment potential compared to volatile metropolitan markets, making them attractive alternatives for buyers, investors, and developers.

3. Changing Investment Strategies for 2025

Real estate investing is evolving, with a stronger emphasis on:

Supply and demand dynamics driving market choices
Newer, modernized buildings attracting more interest
A growing need for senior housing developments

For investors, this means careful market research and strategic decision-making are more important than ever. With economic fluctuations and shifting buyer demands, smart investments in high-demand sectors will yield the best results.

4. Housing Market Growth Projections

After a challenging few years, the housing market is set to rebound in 2025.

Existing home sales are expected to rise by 9%
New home sales are projected to increase by 11%
Inventory levels are improving, offering more options for buyers

However, mortgage rates are expected to remain stable, influenced by broader economic policies and federal decisions. For buyers and sellers, 2025 will offer opportunities—but timing will be key.

5. Technology is Revolutionizing Real Estate

The real estate industry is embracing digital transformation, with major investments in:

Data centers and smart home technologies
Virtual real estate tours and AI-driven property searches
Expanding digital infrastructure like cell towers

Tech-savvy buyers and sellers are demanding more digital-first solutions, reshaping how real estate transactions are conducted. For agents, investors, and developers, staying ahead of technological trends will be crucial for long-term success.

6. Policy Changes & Regulatory Impacts

New real estate regulations will shape housing markets in 2025, including:

Expanding Accessory Dwelling Units (ADUs): More states are passing laws to allow ADUs, increasing rental supply.
Stronger Renters' Rights Protections: New policies may impact landlords and property managers.
Zoning & Housing Affordability Initiatives: Cities are adjusting zoning laws to ease housing shortages.

Understanding how these changes affect property values, investment opportunities, and development will be critical for anyone navigating the market.

Final Thoughts: How to Navigate the 2025 Market

With Gen Z entering real estate, mid-sized cities gaining popularity, and technology driving major shifts, 2025 presents new opportunities and challenges for buyers, sellers, and investors.

If you’re looking to buy, sell, or invest in the Scottsdale or Phoenix Metro area, staying ahead of these trends will help you make smarter, more strategic decisions.