As we move into the second half of 2024, here's what experts predict for home prices, mortgage rates, and home sales.
Home Prices Expected to Climb Moderately
Home prices are forecasted to rise at a more normal pace. Seven trusted industry sources show that while prices will continue to appreciate, the rate will be more gradual compared to the rapid increases seen during the pandemic.
Jessica Lautz, Deputy Chief Economist at the National Association of Realtors (NAR), explains the ongoing price appreciation:
"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."
Despite an increase in inventory compared to the past couple of years, overall housing supply remains low. This shortage will maintain upward pressure on prices.
For prospective buyers, this means the extreme price hikes of the pandemic era are behind us. While prices will not drop, they will climb at a slower rate. Entering the market sooner rather than later could save you money over time, and you can be confident that your home's value will continue to grow.
Mortgage Rates Forecasted to Decline Slightly
Good news for both buyers and sellers: mortgage rates are expected to decrease slightly. Predictions from Fannie Mae, the Mortgage Bankers Association (MBA), and NAR suggest a modest reduction in rates.
Even a small drop in mortgage rates can significantly impact monthly payments for buyers. For sellers, lower rates will likely attract more buyers, facilitating quicker sales and potentially higher prices. This could also encourage those who have been hesitant to sell due to high rates to reconsider.
Home Sales Projected to Hold Steady
The number of home sales in 2024 is expected to remain stable, with a slight increase possible. Forecasts from Fannie Mae, MBA, and NAR suggest around 5 million home sales in 2024, up from the 4.8 million homes sold last year.
Lawrence Yun, Chief Economist at NAR, attributes this to job gains, stable mortgage rates, and an increase in inventory from sellers who had previously held back:
"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 decrease, a slight rise in home sales is anticipated. This means more opportunities for people to move and find their new homes.
If you have any questions or need help navigating the market, reach out to a local real estate agent.
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