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The real estate market is poised for a positive turn in 2024 as lower mortgage interest rates create a favorable environment for home buyers and sellers. Currently sitting below 7%, these rates mark the lowest point since September 2022, offering promising prospects for those looking to invest in the housing market.
Lisa Sturtevant, Chief Economist at Bright MLS, expressed optimism about the ongoing trend, stating, “We will continue to see mortgage rates fall in 2024. That is good for the housing market, particularly for buyers.” The anticipation is that rates will further decrease to 6.2% by the end of the year, providing a significant boost to the overall real estate landscape.
Comparatively, with the average rate historically at seven and three-quarters percent, the projected 6.2% might seem higher than in recent years but remains considerably lower than the long-term average. Sturtevant notes, “And that’s probably where we’ll be for a little while.” This decrease in mortgage rates is expected to incentivize more sellers to enter the market, breaking the inertia among homeowners reluctant to sell due to their meager mortgage rates.
2024 has been dubbed the “year of life happens” by Sturtevant, attributing the expected surge in home listings to changing family and financial circumstances. Homeowners, faced with life changes, are likely to list their properties for sale, contributing to an increase in overall housing inventory.
While home prices are expected to remain high, potential buyers are advised to seize opportunities and be well-prepared. Sturtevant emphasizes the importance for buyers, especially those relying on mortgages, to have their financial affairs in order. “If you are a buyer coming with a mortgage, you still have to be prepared to have all your financial ducks in a row,” she added.
Bright MLS anticipates a substantial 9.3% increase in housing inventory by the end of 2024. Despite the rise in available properties, the market’s competitive nature is expected to persist. Buyers, on average, may need to make two or three offers on properties before securing a purchase. This underscores the importance of being proactive and well-prepared in pursuing real estate opportunities.
As the real estate market gears up for a dynamic year, spring is expected to kick off early. The combination of lower interest rates and increased inventory sets the stage for an active and potentially lucrative real estate landscape in 2024. Both buyers and sellers are encouraged to navigate the market with strategic planning and a readiness to adapt to evolving conditions, ensuring a successful and satisfying real estate experience in the coming year.
