As we move into the second half of 2024, experts have shared their insights on what to expect for home prices, mortgage rates, and home sales. Here’s a detailed look at their predictions:
Home Prices Are Expected to Climb Moderately
Home prices are forecasted to rise at a more typical pace. The following graph shows the latest forecasts from seven of the most trusted sources in the industry:
The primary reason for continued appreciation is 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 has increased compared to the last couple of years, it remains low overall. This scarcity will keep upward pressure on prices.
If you’re considering buying a home, the good news is you won’t face skyrocketing prices like during the pandemic. However, prices aren’t expected to drop; they will continue climbing at a slower pace. Entering the market sooner rather than later could save you money in the long run. Plus, you can be confident that your home's value will appreciate after you purchase it.
Mortgage Rates Are Forecasted to Come Down Slightly
One of the best pieces of news for both buyers and sellers is that mortgage rates are expected to decrease slightly. This forecast comes from Fannie Mae, the Mortgage Bankers Association (MBA), and NAR (see the chart below):
When you buy, even a small drop in mortgage rates can significantly reduce your monthly payments. For sellers, lower rates will attract more buyers, helping you sell faster and potentially at a higher price. Lower rates might also encourage hesitant sellers to enter the market.
Home Sales Are Projected to Hold Steady
In 2024, the number of home sales is expected to be about the same as last year and may even increase slightly. The graph below compares the 2024 home sales forecasts from Fannie Mae, MBA, and NAR to the 4.8 million homes 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:
“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 decline, more homes are likely to be sold this year compared to last year. This means more people will have the opportunity to move. Let’s work together to ensure you’re one of them.
Bottom Line
If you have any questions or need help navigating the market, feel free to reach out.