Key facts
- Gary Keller stated government policies, not economic conditions, prevented anticipated interest rate reductions.
- The 30-year fixed conventional mortgage rate is currently 6.86%.
- Home prices are projected to increase by 5.4% this year.
- Existing home sales are expected to remain around 4 million units in 2026.
- Keller Williams executives believe it is still a favorable time for clients to purchase homes.
- A significant majority of consumers (88%) utilized real estate agents in 2025.
Gary Keller, co-founder and executive chairman of Keller Williams, stated at the firm's annual Mega Agent Camp that government policies, rather than economic fundamentals, have prevented anticipated interest rate reductions. Keller explained that while the economic conditions appeared favorable for lower rates, new administrations often implement policies that disrupt such expectations.
He noted that current mortgage rates remain elevated, with the 30-year fixed conventional mortgage rate at 6.86%. Furthermore, home prices are projected to rise by 5.4% this year, exceeding the typical 4% annual increase, which continues to impact affordability. Consequently, existing home sales are expected to stagnate around 4 million units through 2026, a trend described by Cody Gibson, VP of KW MAPS Coaching, as potentially the longest period of stagnation in modern history.
Keller Williams leaders also drew parallels between mortgage rate fluctuations and sales trends with geopolitical developments, specifically mentioning the conflict in Iran. Ruben Gonzalez, the company's chief economist, observed that sales dipped as mortgage rates decreased earlier in the summer following news of a ceasefire, but then declined again as tensions resurfaced.
Despite these challenges, Keller Williams executives urged agents to advise clients that it remains a good time to buy property. They emphasized that one buys at the 'top of the moment' rather than the 'top of the market.' However, Keller expressed concern over younger generations' reluctance to purchase homes, viewing it as detrimental to their long-term wealth building. He argued that homeownership, even with current prices, offers greater financial security over time compared to renting.
The average number of transactions per agent is anticipated to be 5.7 in 2025, a slight increase from the previous year but significantly below the historical average of 10. Jason Abrams, KW's chief industry and strategy officer, highlighted the importance of finding motivated buyers in the current market. He also pointed to data from the National Association of Realtors indicating that 88% of consumers still rely on real estate agents for transactions, countering narratives about AI replacing agents.