By New England Landmark Realty LTD
Nationally, 2024 marked a pivotal moment in the housing market, as inventory levels climbed closer to pre-pandemic norms. While these gains didn't trigger the widespread price declines some predicted, they signaled a gradual return to healthier market conditions. For Vermont, however, this shift is moving at its characteristic pace—historically slower than national trends but often following the same trajectory. Vermont's unique market conditions, shaped by its size, geography, and demand dynamics, add nuance to these changes.
Vermont: A Slow, Steady Follower of National Trends
Vermont's real estate market has a long history of mirroring national patterns, albeit with a lag. In the aftermath of the 2008 housing crash, Vermont saw fewer foreclosures and slower price declines than national markets, but it recovered more gradually. Similarly, when the pandemic housing boom sent prices skyrocketing across the country, while substantial, Vermont's growth in median home prices was tempered by limited inventory and fewer high-risk buyers.
As national inventory rises toward 2019 levels, Vermont is again catching up, but at its own pace. Nationally, inventory peaked at 739,434 homes this year, compared to a low of 240,497 in 2022. Vermont's inventory has yet to rebound significantly as the state grapples with systemic challenges like restrictive zoning and a small housing stock. However, historical trends suggest that Vermont will follow the broader national trajectory—eventually benefiting from the increased balance between supply and demand.
How National Trends Compare Locally
New Listings
While new listings nationally reached a weekly peak of over 75,000 in 2024—still below pre-pandemic norms—Vermont remains far behind. During the 2008 housing crisis, Vermont's new construction projects slowed dramatically and took longer to recover than in other states. Today, many Vermont communities are still working to offset those deficits, with legislative initiatives like Act 250 reform aiming to spur development. While small towns like Barre and Springfield are starting to see more activity, Burlington and Montpelier remain highly competitive.
Price Cuts and Stabilization
Nationally, price cuts hovered around 36.4% in 2024, reflecting growing inventory and stabilizing prices. In Vermont, price cuts are less frequent due to persistently high demand, especially in desirable areas like Stowe and Woodstock. However, the trend of slower but steady price appreciation, seen after the 2008 crash, suggests that Vermont could see stabilization sooner than expected if inventory continues to grow.
Mortgage Rates and Demand
National mortgage rates, ranging between 5.75% and 7.25% in 2024, affect Vermont buyers just as they do elsewhere. Historically, when national rates dropped in the 2010s, Vermont experienced an uptick in demand, particularly from out-of-state buyers. With rates stabilizing, Vermont may see more balanced conditions, though demand from remote workers and second-home buyers remains a key factor.
The Ray of Hope: Vermont's Slow, Steady Resilience
Vermont's market is defined by its resilience. While national trends take time to reach the state, they often bring long-term benefits. Buyers in 2025 can expect:
- Gradual Inventory Growth: Legislative efforts, like increased funding for affordable housing, will slowly expand Vermont's housing stock.
- Opportunities in Undervalued Areas: Towns beyond Burlington, such as Randolph and Newport, attract attention as buyers seek affordable options.
- Stabilizing Prices: As inventory grows, Vermont's historically moderate price trends may further stabilize, offering more predictability for buyers.
- A Stronger Local Economy: Vermont's rising wages and economic diversification—seen in sectors like renewable energy and tech—support buyer purchasing power.
Conclusion
Rising inventory is the national housing story of 2024, and Vermont will likely follow this trend as it has in the past—at its own deliberate pace. While challenges remain, Vermont's history of steady growth and legislative efforts provide a path forward. Buyers who understand the state's unique dynamics and embrace its slower shifts can find opportunities in 2025, particularly in emerging markets and less competitive areas.
Navigating Vermont's Real Estate Market?
Tony Walton and the NELandmark.com team bring unparalleled expertise to Vermont's housing market. Whether you are searching for a home in bustling Burlington or exploring opportunities in smaller towns, Tony's local knowledge will guide you every step of the way. Call 802-253-4711 today!
