Get A Quote
2024 Real Estate Forecast: What to Expect
Everyone in the real estate industry is asking the same question: Will 2024 be a better year for the housing market? According to experts, there are some things that will stay the same, but some that will change. From interest rates to home prices, let’s look at what you can expect from the housing market in 2024.
Interest Rates May Decline in 2024
The word inflation is one we became very familiar with in 2023. Because of the strain on the economy, the housing market quickly saw interest rates rise over the year—even getting to be over 7.4%. However, experts are saying that the shock of inflation is beginning to wear off and there should be some rate decreases over the next 12 months. According to Redfin.com, “…the average 30-year mortgage rate will linger at 7% in the first quarter, then decline throughout the year. Mortgage rates will fall to about 6.6% by the end of 2024. The gradual decline in rates combined with the small dip in prices will bring homebuyers some much-needed relief.”
It seems as though the 6% interest rate will be here to stay, and perhaps we should all become accustomed to this new benchmark. The days of COVID 3% rates are long behind us.
Forbes.com states, “Economists are also optimistic that the Federal Reserve is done with its rate-hiking campaign to lower inflation after policymakers kept the federal funds rate unchanged for a third straight meeting on December 13. The federal funds rate is the benchmark interest rate financial institutions charge each other for overnight loans; it tends to indirectly influence mortgage rates.”
To better understand the ebb and flow of real estate interest rates over the last few decades, check out this informative blog.
Home Prices Will Begin to Fall
Home prices have been on a steady incline for well over a decade, but experts are predicting that that trend may finally take a turn in the opposite direction. For many of your clients, the high home prices and interest rates have been a deterrent for buying. We have seen so many of our agents and lender partners work tirelessly to help their clients be able to still afford the home of their dreams. Our hats go off to all of you real estate professionals for successfully navigating 2023. With 2024 underway, will we begin to see home prices fall?
According to realtor.com, “Home prices are expected to ease slightly, dropping less than 2% for the year on average.” With the potential drop in home prices, 2024 may be year for some relief for your clients anxiously awaiting a change in the market.
More Listings Will Hit the Market
With the understanding that 3 and 4% interest rates are a thing of the past, more sellers may be ready to list their homes in 2024 before home prices begin to fall. Now may be a great time to start encouraging your potential sellers to make some decisions on listing their home this year.
And when it comes to new construction, the upward trend for builders is still on the rise. Your clients can expect to continue to see new inventory hit the market—which can be very appealing to the right buyer. According to Forbes.com, “The most recent National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI), which tracks builder sentiment, rose from 34 to 37 in December. A reading of 50 or above means more builders see good conditions ahead for new construction.”
Home Sales Will Increase
2023 saw a decline in home sales, which didn’t come as a surprise with the state of the economy. But with inflation losing its sting, and the rates at a steadier 6-7%, it is predicted that 2024 will see an increase in home sales. RedFin.com predicts, “Sales will continue rising throughout the year; they’ll be on pace for a total of 4.5 million by the fourth quarter. Home sales will speed up throughout 2024 as affordability improves and more homes hit the market.
A big area to pay attention to throughout the year is if the sale of homes continues to increase. That momentum is key in this prediction. If there starts to be a decline, especially in the busier quarters, we know things may not be growing as predicted. Either way, be prepared for a potential increase in your sales volume based on current market trends.
Changes to the Industry are Inevitable
It’s pretty amazing to look back just four years at the housing industry and see how quickly we have changed to meet the new digital demands of our clients. And these demands don’t have any chance in slowing down. In 2024, we predict even more change is coming to the real estate industry when it comes to streamlining and automating the home buying and selling process. Artificial Intelligence is becoming a big deal in business. Most websites are now integrating chatbots as part of their marketing strategy. When it comes to meeting your client’s needs in 2024, be prepared to think outside the box and expand your offerings to accommodate ease-of-use.
At Velocity Title, one way we adopted this mindset in 2023 is with Remote Online Notarization (RON) closings. These allow you and your clients to safely and easily conduct the closing process via a secure internet connection. This is a game-changer for the industry. To learn more about offering your clients RON closings in 2024, click here.
No matter what 2024 has in store, real estate professionals will do what they do best: Educate themselves, rally through and find ways to still meet the changing needs of their clients. At Velocity Title, we have your back and look forward to successfully navigating this year by your side.
Velocity Title Moves You Forward
Velocity Title supports the industry with a comprehensive line of title services that add value to each and every transaction. At Velocity Title, Our Personal Support Makes You Look Good Every Time! With a focus on the best CUSTOMER EXPERIENCE, Velocity Title incorporates leading title TECHNOLOGY and EXPERTISE into every transaction—enabling the final step in the home buying and investing process to be EASY, EFFICIENT and INFORMATIVE. For the perfect settlement experience every time, click here or contact us today!