The Second Half of 2024's Real Estate Market Forecast
As we are now crossing over into the second half of 2024, industry experts have been making their projects for what we should expect for home prices, home sales and mortgage rates.
Home Prices
Experts predict that home prices for the second half of the year will continue to rise at a more normal pace. Seven industry experts including Fannie Mae, HPES, MBA, Goldman Sachs, NAR, Zillow and Freddie Mac all have varying positive predictions of increases. The average for all is 2.9% The reason for the continued momentum in appreciation is the supply of homes. 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.”
Even though inventory has been increasing, it is still low overall. The basic supply and demand theory applies here which keeps the pressure to increase prices. So for those who are looking to buy, the good news is that prices shouldn’t be skyrocketing like they did, they will just increase at a more normal rate.
Home Sales
The total number of home sales is also projected to increase. Fannie Mae, MBA and NAR all average out to predict 4.8 million home sales which is a small increase over 2023. Lawrence Yun, Chief Economist at NAR, explains why: “Job gains, steady mortgage rates and the release of inventory from pent-up home sellers will lead to more sales.”
With increasing inventory and mortgage rates being more favorable, we should expect to see slightly more homes being sold this year compared to last year.
Mortgage Rates
Finally, mortgage rates are expected to come down just a bit. According to Fannie Mae, MBA (Mortgage Bankers Association) and NAR they average their predictions of 6.73% for Q3 and 6.57% for Q4 of this year. Even a small drop in rate can have a large impact on buying power for those looking to purchase. This also can ease sales for those looking to sell which makes for better market conditions for all.