Are you considering a change of address in the near future? Whether you’re looking to buy a home in San Diego or sell your current one? Understanding the 2024 housing forecast of the real estate market is a crucial factor to consider. Last year, navigating the real estate landscape was tricky due to rising mortgage rates, mixed signals about home prices, and a tight supply of properties. These factors posed unique challenges for both buyers and sellers eager to make their move. So, what can we expect as we step into the new year?
There’s a bright spot on the horizon, and it’s bringing a wave of optimism. Many real estate experts believe we’re moving past these hurdles and heading towards a more encouraging market climate.
Mortgage Rates
One key aspect to watch is the trend in mortgage rates. Lately, there’s been a noticeable decrease, offering a glimmer of hope for those grappling with affordability issues. Mark Fleming, the Chief Economist at First American, sheds light on this trend, suggesting that mortgage rates might continue to ease up.
“Mortgage rates have already retreated from recent peaks near 8 percent and may fall further . . .”
According to Jessica Lautz, the Deputy Chief Economist at the National Association of Realtors (NAR), there’s much to consider in the current real estate landscape. Jessica brings a wealth of knowledge and expertise to her role at NAR. Her insights are particularly valuable for anyone looking to understand the intricate dynamics of today’s housing market. With a clear and accessible approach, she sheds light on the various factors influencing real estate trends, making complex topics understandable for everyone.
“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.”
Anticipating a Boost in Home Supply with Easing Rates
The dynamic real estate landscape is poised for a notable shift. As interest rates begin to ease, we’re expecting a significant uptick in housing market activity. This change is set to draw in a wave of both buyers and sellers who have been on the sidelines, eagerly waiting for the right moment. This resurgence of participation is a key factor that could lead to an increase in the availability of homes for sale – a positive trend that we’re already witnessing unfold this year. Adding to this perspective, Lisa Sturtevant, the Chief Economist at Bright MLS, shares her insights:
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%.”
Expectations for More Balanced Home Price Growth
In addition to the encouraging trend of decreasing mortgage rates, there’s more good news on the horizon for home affordability. Experts predict that the growth in home prices is likely to become more moderate. This change is anticipated as the inventory of available homes begins to improve. However, it’s important to note that overall, inventory levels are still relatively low. This shift towards more balanced price growth is highlighted in the Home Price Expectation Survey (HPES) from Fannie Mae. This comprehensive survey gathers insights from over 100 economists, investment strategists, and housing market analysts. They collectively provide a clearer picture of the trends we can expect, stating:
“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.”
As we draw our discussion to a close, it’s heartening to hear from industry experts who are optimistic about 2024 shaping up to be a more favorable year for the housing market. This is great news, especially if you’re considering buying or selling a home next year. The emerging trends suggest that we’re on the cusp of a significant positive shift. Echoing this sentiment, Mike Simonsen, the respected President and Founder of Altos Research, has shared his insights too…
“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.”
Bottom Line on the 2024 Housing Forecast
As we look ahead to 2024, there’s a growing sense of optimism among experts about the housing market’s prospects. For those of you considering buying or selling a home in this promising new year, staying informed about the latest market trends is crucial. The most effective way to do this? Collaborate with a reliable real estate agent who’s in the know like the McT Real Estate Group. By partnering together, we can navigate the exciting opportunities that 2024 has in store. Ready to take the next step? Let’s connect and start this journey.