What Experts Predict For 2024's Housing Market
If you are thinking about purchasing or selling a home in the near future you most likely want to know what to expect from the new year’s housing market. Last year in 2023 we experienced mortgage rates creeping up high, a continued lack of housing inventory and then some confusion about what headlines suggested about home price trends. The good news is that there are many experts who are forecasting some positive things for the real estate market.
Mortgage Rates
The exceptional news here is that home loan rates have begun to come down. The anticipated pattern for them is to follow inflation and since that has declined, rates will shortly follow. Jessica Lautz, Deputy Chief Economist at the National Association of Realtors (NAR), says: “For home buyers who are taking on a mortgage to purchase a home and have been wary of the autumn rise in mortgage rates, the market is turning more favorable, and there should be optimism entering 2024 for a better market.”
Housing Supply
As mortgage rates start to ease, there should be more activity in the real estate market as a result as those who have put their move on hold will be picking it back up. If more sellers begin putting their homes on the market for sale then we will see inventory increase which has slowly been happening towards the end of 2023. Lisa Sturtevant, Chief Economist at Bright MLS, says: “Supply will loosen up in 2024. Even homeowners who have been characterized as being ‘locked in’ to low rates will increasingly find that changing family and financial circumstances will lead to more moves and more new listings over the course of the year, particularly as rates move closer to 6.5%.”
Home Prices
Mortgage rates moderating isn’t the only good sign for affordability. Home price growth is also predicted to ease a bit too. As the Home Price Expectation Survey (HPES) from Fannie Mae, a survey of over 100 economists, investment strategists, and housing market analysts, says: “On average, the panel anticipates home price growth to clock in at 5.9% in 2023, to be followed by slower growth in 2024 and 2025 of 2.4 percent and 2.7 percent, respectively.”
In sum, experts predict 2024 will be a better, closer to normal year for the housing market. So, if you’re contemplating making a move next year, know that these early signs are indicating that we’re turning a corner. As Mike Simonsen, President and Founder of Altos Research, puts it: “We’re going into 2024 with slight home-price gains, somewhat easing inventory constraints, slightly increasing transaction volume . . . All in all, things are looking up for the U.S. housing market in 2024.”