Real estate news and policy shifts are driving significant changes across the housing market in 2025. Property owners, buyers, and sellers face new rules, fluctuating mortgage rates, and evolving zoning laws. These developments affect property values, investment decisions, and housing affordability nationwide.
This article covers the most important real estate news and policy updates happening right now. It examines legislative changes, market trends, lending policies, and zoning reforms. Understanding these factors helps stakeholders make informed decisions in a shifting landscape.
Key Takeaways
- The SALT deduction cap increased to $15,000 in 2025, benefiting property owners in high-tax states like California, New York, and New Jersey.
- Housing inventory rose 12% compared to late 2024, giving buyers more options as mortgage rate lock-in effects weaken.
- Mortgage rates averaged 6.4% in December 2025, down from the 7.2% peak in early 2024, improving buyer purchasing power.
- Real estate policy shifts include expanded zoning reforms allowing duplexes and ADUs in single-family zones across more states.
- Lenders loosened credit requirements, with average approved credit scores dropping to 725 and more 3-5% down payment programs available.
- Buyers and sellers should stay informed on real estate news and policy changes, as stricter rent controls and updated tenant protections now vary significantly by location.
Recent Legislative Changes Impacting Property Owners
Several new laws have reshaped the real estate landscape this year. Property owners should pay close attention to these legislative shifts.
Tax Law Adjustments
Congress passed updated property tax deduction limits in early 2025. Homeowners can now deduct up to $15,000 in state and local taxes (SALT), up from the previous $10,000 cap. This change benefits property owners in high-tax states like California, New York, and New Jersey.
Capital gains exemptions remain at $250,000 for single filers and $500,000 for married couples. But, new regulations require owners to prove primary residence status for at least three of the past five years before claiming the exemption.
Rental Property Regulations
Several states have enacted stricter rent control measures. California expanded its statewide rent cap to cover more properties built before 2010. New York strengthened tenant protections, limiting security deposits and tightening eviction procedures.
These real estate policy changes create new compliance requirements for landlords. Property owners must update lease agreements and review local ordinances to avoid penalties.
Housing Market Trends To Watch
The housing market shows mixed signals heading into 2026. Real estate news indicates both opportunities and challenges for market participants.
Inventory Levels
Housing inventory has increased 12% compared to late 2024. More sellers are listing properties as mortgage rate lock-in effects weaken. Still, inventory remains 25% below pre-pandemic levels in most metropolitan areas.
New construction activity picked up in the second half of 2025. Builders started 1.4 million housing units this year, focusing on single-family homes and townhouses. This supply boost should ease price pressures in 2026.
Price Dynamics
National home prices rose 4.2% year-over-year through November 2025. Price growth slowed from the 6% gains seen in 2024. Sun Belt markets like Phoenix, Tampa, and Austin experienced price corrections of 2-5%.
Affordability constraints continue limiting buyer activity. The typical home now costs 5.5 times the median household income. First-time buyers struggle the most, with many priced out of starter home markets.
Mortgage Rate Movements And Lending Policies
Mortgage rates remain a central focus in real estate news and policy discussions. Rate changes directly impact buyer purchasing power and market activity.
Current Rate Environment
The 30-year fixed mortgage rate averaged 6.4% in December 2025. Rates dropped from their 7.2% peak in early 2024 but stayed above the sub-4% levels buyers enjoyed pre-pandemic. The Federal Reserve’s rate cuts helped push mortgage rates lower throughout the year.
Adjustable-rate mortgages (ARMs) offer lower initial rates around 5.8%. But, financial advisors caution buyers about rate reset risks. Fixed-rate loans provide more predictable payments over time.
Lending Standard Updates
Lenders loosened credit requirements slightly this year. The average credit score for approved mortgages dropped to 725, down from 735 in 2024. Down payment requirements also eased, with more programs accepting 3-5% down.
Real estate policy changes expanded FHA loan limits to $498,257 in most markets. Conforming loan limits rose to $806,500, allowing more buyers to access conventional financing. These adjustments help moderate-income buyers compete in expensive markets.
Zoning And Land Use Policy Updates
Zoning reform emerged as a major theme in real estate policy this year. Cities and states are rethinking land use rules to address housing shortages.
Single-Family Zoning Changes
More states now allow duplexes and accessory dwelling units (ADUs) in single-family zones. Oregon, California, and Washington led this movement. Montana and Arizona joined in 2025, overriding local restrictions on multi-unit housing.
These zoning changes aim to boost housing supply without sprawl. ADUs let homeowners add rental units in backyards or garages. Duplexes and triplexes can replace aging single-family homes in established neighborhoods.
Transit-Oriented Development
Cities are increasing density near transit stations and bus corridors. Minneapolis eliminated parking minimums citywide. Los Angeles approved higher-density housing along major transit lines.
Real estate news coverage shows developers responding to these policy shifts. Multi-family projects near transit hubs attract strong investor interest. These locations offer residents lower transportation costs and easier commutes.
What These Changes Mean For Buyers And Sellers
Real estate news and policy developments create different impacts for buyers and sellers. Understanding these effects helps both groups plan their next moves.
For Buyers
Buyers benefit from increased inventory and slightly lower mortgage rates. The expanded SALT deduction improves affordability for those purchasing in high-tax states. Looser lending standards open doors for buyers with lower credit scores.
But, prices remain elevated in most markets. Buyers should get pre-approved, research local markets carefully, and move quickly on well-priced listings. First-time buyer programs offer down payment assistance in many areas.
For Sellers
Sellers face a more competitive market than in 2021-2022. Properties take longer to sell, and multiple-offer situations are less common. Pricing accurately matters more than ever.
On the positive side, home equity remains near record highs. Sellers who purchased before 2022 hold substantial gains. Those looking to downsize or relocate can still achieve strong returns on their investments.
Real estate policy affecting rentals requires landlords to review compliance carefully. Updated tenant protections and rent control rules vary by location.
