End-of-Year Real Estate Review: What to Expect in 2024

As we prepare to say farewell to another year, it's time to reflect on the real estate market's performance in 2023 and anticipate what might unfold in 2024. From mortgage rates to home inventory and price trends, we've got you covered with all the essential insights to help you plan your real estate journey.

Mortgage Rates: A Glimpse into 2024

One of the most significant factors influencing the real estate market is mortgage rates. The burning question on everyone's mind is whether mortgage rates will drop in 2024. Well, the good news is that Forbes Magazine reported that home buyers may finally get some relief on mortgage rates in the upcoming year.

The Federal Reserve, responsible for setting the benchmark lending rate, recently announced that it would leave its rate unchanged. This move marked the end of a two-year campaign to tighten credit, and now the central bank is expected to begin easing rates downward. In fact, they've even hinted at up to three rate cuts in 2024.

Based on all this data, the National Association of Realtors has estimated that rates will fall into the 6% range by the spring of 2024. This is great news for prospective buyers who have been waiting for the right moment to qualify for a mortgage.

Real Estate Inventory and Price Trends

Now, let's delve into the state of home inventory and price trends, which can greatly impact both buyers and sellers.

In general, the real estate market is predicted to have about the same number of sales, and property values are expected to remain stable or see very slight reductions. However, when it comes to specific price ranges, the dynamics vary significantly.

For homes priced below $300,000, the demand far exceeds the supply. In this segment, we're looking at just a 1.5-month supply. Even as the market slows down, sellers in this price range are still facing competition, with sellers, on average, closing at 96% of the list price, and properties spending an average of 29 days on the market.

As we move up the price ladder, the months of inventory increase, leading to more balanced markets starting at the $700,000 mark. A buyer's market emerges at $1,250,000, and for homes priced over $2,000,000, there's a noticeable surplus of sellers with a 13.4-month supply.

In summary, most experts agree that prices will remain stable below the $1,000,000 mark but may experience some declines above that threshold in 2024. While there's been a notable 42.4% increase in inventory, sales are still robust, showing a 20% uptick compared to the same quarter last year.

The median price for the two-county region stands at $495,000, representing a slight decrease of 3.8% compared to the same quarter last year. Housing inventory has increased to a 4.5-month supply, just shy of the 5-month benchmark that signifies a neutral market. Currently, we find ourselves in an ever-so-slight seller's market.

As we welcome 2024, the real estate landscape promises opportunities for both buyers and sellers. The key is to stay informed, monitor market trends, and seek the guidance of local real estate experts who can provide region-specific insights. Here's to a successful and prosperous 2024 in real estate!