Housing Market Forecast 2nd half of 2024 – A National Perspective

Occasionally, throughout the year, we offer national perspectives on real estate topics. I’m never sure I would call whoever they are paraphrasing to be “experts,” but I do acknowledge they are professionals, and occasionally, their opinions seem relevant. While our experience tells us these are not directly correlated to our local market, they can be tangentially or indirectly related to our situation. Here are some very broad statistics we feel are worth sharing. The last quote (highlighted in red) is probably the most important takeaway.

As we move into the second half of 2024, here’s what experts say you should expect for home prices, mortgage rates, and home sales.

Home Prices Are Expected To Climb Moderately

Home prices are forecasted to rise at a more normal pace. The graph below shows the latest forecasts from seven of the most trusted sources in the industry:

The reason for continued appreciation? The supply of homes for sale. Jessica Lautz, Deputy Chief Economist at the National Association of REALTORS® (NAR), explains:

“One thing that seems to be pretty solid is that home prices are going to continue to go up, and the reason is that we don’t have housing inventory.”

While inventory is up compared to the last couple of years, it’s still low overall. And because there still aren’t enough homes to go around, that’ll keep pressure on prices upward.

If you’re thinking of buying, the good news is you won’t have to deal with prices skyrocketing like they did during the pandemic. Just remember, prices aren’t expected to drop. They’ll continue climbing, just at a slower pace.

So, getting into the market sooner rather than later could still save you money in the long run. Plus, you can feel confident that experts say your home will grow in value after you buy it.

Mortgage Rates Are Forecast To Come Down Slightly

One of the best pieces of news for both buyers and sellers is that mortgage rates are expected to come down a bit, according to Fannie Mae, the Mortgage Bankers Association (MBA), and NAR (see chart below):

When you buy, even a small drop in mortgage rates can make a big difference in your monthly payments. For sellers, lower rates will bring more buyers back into the market, which can help you sell faster and potentially at a higher price. Plus, it may help you get off the fence if you’ve been hesitant to sell due to today’s rates.

Home Sales Are Projected To Hold Steady

For 2024, the number of home sales will be about the same as last year and may even rise slightly. The graph below compares the 2024 home sales forecasts from Fannie Mae, MBA, and NAR to the 4.8 million homes that sold last year:

The average of the three forecasts is about 5 million sales in 2024 – a small increase from 2023. Lawrence Yun, Chief Economist at NAR, explains why:

“Job gains, steady mortgage rates and the release of inventory from pent-up home sellers will lead to more sales.”

With more inventory available and mortgage rates expected to go down, a few more homes are expected to be sold this year compared to last year. This means more people will be able to move. Let’s work together to make sure you’re one of them.

Our Take on What May Happen the Rest of 2024:

Prices will likely stay in line with where they are now. Interest rates will likely stay in line with where they are now. Inventory might decrease slightly. So a lot of very little.

Most of you who talk with us regularly know we are not inclined to suggest the need to act immediately. Planning and strategic thinking tend to be the hallmark of our clients’ success.

However, to be successful in a dynamic market, one needs to be willing and ready to change course. Now may be one of those times. We suspect we are at an inflection point – not so much in market statistics, but in the opportunity of client success in the real estate market. Yes, prices can continue to go up (inflation dictates all assets go up over a long enough time horizon). Other than the tired mantra of “lack of inventory,” there are possibly more insightful reasons prices will largely remain flat for the foreseeable future.

Therefore, if we are competing against the market (which we are always doing), our current suggestion is to get out ahead of the competition. Both Buyers and Sellers act as early as you can – Now. There is arbitrage in the current market where either side of a transaction, buyers or sellers, can be winners. We will explain this in far greater detail if this is of interest to you.

The information contained in this article and the opinions expressed are not intended to be construed as investment advice. Keeping Current Matters, Inc. does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. Keeping Current Matters, Inc. will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein.