2024-08-28

What To Expect From The Housing Marketing in 2024

The housing market dynamics are always changing. Prices fluctuate with market demand, changing mortgage rates, and with economic transitions. Supply and demand flow based on these factors.
Given the shifts, you must scrutinize the current market conditions before making any buying or selling decision. Otherwise, you could end up overpaying when purchasing property, or selling below value.
1. Housing Supplies Will Continue to Be Low
At the end of 2023, the US housing market had around one million homes for sale. This inventory was equivalent to a 3.2-month supply. Normally, a five to six-month supply is considered sufficient for the market.
Real estate analysts predict that the supply of housing units will remain low through 2024, unless there is a surge of sellers. Many potential sellers will hold onto their current property for fear of buying their next homes at inflated prices. Homeowners paying a 3% interest rate are less likely to trade for the current 7% rates.
2. Home Prices Will Increase
Since 2023, the cost of housing has maintained an upward trend. Real estate analysts expect the property value to keep soaring into 2024. For one reason, in 2024, mortgage rates will likely decline due to favorable economic conditions.
The reduction in mortgage rates will encourage more buyers to enter the market. The result? There will be an increase in buyer activity, intensifying demand for the already scarce homes for sale. The high demand will push home prices to the higher side.
3. Mortgage Rates Will go Down
Despite a recent surge in mortgage rates, many realtors remain optimistic that the rates will reduce as 2024 progresses. Most likely, mortgage rates will decrease once the Federal Reserve imposes interest rate cuts.
According to Forbes, mortgage rates are projected to reduce to around 6% to 6.5% by spring 2024. Notwithstanding, the mortgage rate projections depend on factors like consumer spending, GDP growth, and inflation.
4. There Won’t be a Housing Recession
Contrary to doomsayers, in 2024, the housing market is unlikely to collapse. Usually, if a housing recession was imminent, the market would experience a surge of housing units for sale, a decrease in prices, and a sharp reduction in demand.
However, as of today, none of the mentioned factors has happened. In fact, the current housing market has insufficient inventory to meet the demand. Furthermore, the prices of houses on sale have increased, indicating that the market is far from the speculated downturn.
5. The Competition for Available Homes Will go Up
Buying your dream home in 2024 is likely to be a tricky affair. The reason is that the market has a low inventory of homes for sale, and many buyers with ready finances to buy. Many of these buyers halted buying homes in 2023, thinking 2024 would be the best year to buy.
Realtors anticipate the market will still have fewer units for sale in the entire 2024. With fewer properties available, buyers should expect cutthroat competition. Worse, if mortgage rates decrease as projected, the competition will intensify.
Is 2024 the Best Year for Buyers or Sellers?
It’s a seller’s market, plain and simple. There’s low supply for housing while demand remains strong. Moreover, mortgage rates remain at heights most buyers have never seen. Property prices are still rising driven by the lack of supply. Houses are moving quickly and desirable properties sell above asking prices. Private equity buyers are still on the prowl. In other words, investors are still buying houses with the purpose of renting them for a profit. Nonetheless, howe owners who would otherwise sell are worried about the availability and cost of the limited options that they may have.

Category: Finance