Oct 21, 2024 Current Resources

What To Expect From The Housing Market In 2024

The housing market dynamics are never constant in any given period. For instance, prices fluctuate with market demand, mortgage rates change with economic transitions, and supply flows with the availability of homes for sale.

Given the shifts, you have to 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.

Discover 2024’s leading trends in the housing market so you can make educated decisions.

1. The Supply for Homes Will be Low

By the end of December 2023, America’s housing market had around one million houses for sale. This inventory was equivalent to a 3.2-month supply, falling short of the five to six-month supply considered sufficient for the market.

Real estate analysts predict that the supply of housing units will remain low to the end of 2024, not 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.

2. Home Prices Will Increase

Since 2023, the prices for homes have maintained an upward trend. Real estate analysts expect the property value to keep soaring into 2024 for many reasons. For one, 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?

2024’s housing market will not be so favorable for buyers. The market has low supply and intense competition for available units. Moreover, mortgage rates are yet to drop to a point that can give buyers some relief. On the contrary, 2024 is two-sided for sellers.

The property prices are still high, and the competition for available units is stiff. So, one is likely to sell quickly and at fair prices. Nonetheless, sellers intending to buy a new home will be disadvantaged by the high property and mortgage rates.