Everyone has different opinions on what is going to happen in 2024 but here are some thoughts. The biggest issues are interest rates and housing inventory. Those will still be there in 2024.
Mortgage interest rates have dropped in the last two months. After seeing some of the highest rates in years, rates have started to drop. How far they drop in 2024 no one really knows. Right now investors expect the Fed to start dropping rates in March but that may change as we get more economic news in the first quarter of 2024. The other part that no one really knows is how far they will drop. Some say low 6’s, I’ve also heard mid 5’s. After the last two years, I really hate to even guess! As long as we can see rates continue to decrease, it’s a good thing.
Housing inventory is the other piece of the puzzle. Most analysts still expect housing inventory to be tight through 2024. Many homeowners do not want to trade a 3% interest rate for a 6.5% rate unless they have to. The other part of this is as rates come down, you will see more people start looking for homes again and that could cause more multiple offers and make it harder to find a home.
With low housing inventory, don’t expect to see home prices decline. Most experts expect to see home prices increase 3-4%, especially if inventory is low and rates continue to decline.
My suggestion is more of the same – if you are looking at buying a home in 2024, start looking soon! The more rates drop, the more chance of multiple offers making it harder to buy. You can always refinance your mortgage. Remember the new saying, “you date the rate, you marry the house”!