By using this site, you agree to the Privacy Policy and Terms of Use.
Accept

Indestata

  • Home
  • News
  • Personal Finance
    • Credit Cards
    • Loans
    • Banking
    • Retirement
    • Taxes
  • Debt
  • Homes
  • Business
  • More
    • Investing
    • Newsletter
Reading: Housing Market 2024 Predictions | Bankrate
Share
Subscribe To Alerts
IndestataIndestata
Font ResizerAa
  • Personal Finance
  • Credit Cards
  • Loans
  • Investing
  • Business
  • Debt
  • Homes
Search
  • Home
  • News
  • Personal Finance
    • Credit Cards
    • Loans
    • Banking
    • Retirement
    • Taxes
  • Debt
  • Homes
  • Business
  • More
    • Investing
    • Newsletter
Follow US
Copyright © 2014-2023 Ruby Theme Ltd. All Rights Reserved.
Indestata > Homes > Housing Market 2024 Predictions | Bankrate
Homes

Housing Market 2024 Predictions | Bankrate

TSP Staff By TSP Staff Last updated: October 30, 2024 13 Min Read
SHARE

Key takeaways

  • Low levels of inventory mean that sellers continue to have the upper hand in the housing market.
  • Mortgage rates have come down from their peak but are still high, and steep home prices are dissuading would-be buyers.
  • If rates were to drop further, that would spur the market for both buyers and sellers.

With home prices historically high, inventory still tight and the dust still settling on commission changes enacted late this summer, many prospective sellers and hopeful buyers are feeling nervous about this winter’s housing market.

The median sale price for an existing home in the U.S. was $404,500 in September 2024, according to the National Association of Realtors (NAR). And after briefly rising above 8 percent in October 2023, the average 30-year mortgage rate as of late this October was 6.78 percent — a welcome decrease but still much higher than most homeowners’ locked-in rates.

Home prices, mortgage rates, inventory levels and commissions will all shape housing affordability through the remainder of this year. Curious where these trends may go? Read on to learn what the experts predict for the rest of the 2024 housing market.

What will happen to the housing market for the end of 2024?

Rates roughly doubled back in 2022, thanks in part to the Federal Reserve’s war on inflation, and they have stayed high since. While the Fed does not directly set mortgage rates, mortgage lenders take cues from them, and mortgage rates climbed in tandem with the Fed’s long string of rate hikes.

The Fed has finally started a cycle of much-anticipated rate cuts, and one more is likely coming before the year is out. But with home prices still reaching record heights and demand for homes outpacing housing supply, it seems homebuyers will still be feeling the squeeze through the rest of the year.

Key housing market stats

  • The median home-sale price as of September 2024 was $404,500 — the highest September median NAR has ever recorded and only about $20K short of the all-time high.
  • The nation had a 4.3-month supply of housing inventory as of September, per NAR, which is a big improvement over a year ago but still low enough to be considered a seller’s market.
  • Home-price growth increased in April 2024 by 6.3 percent, according to S&P CoreLogic’s latest Case-Shiller Index. That’s down from 8.3 percent the previous month.
  • Bankrate’s latest national survey of large lenders shows the average rate on a 30-year mortgage was 7.09 percent as of July 3, 2024.
  • The U.S. inflation rate as of September 2024 was 2.4 percent — getting closer to the Fed’s stated goal of 2 percent, but not quite there yet.

Realtor commission changes

One thing to keep an eye on: Thanks to the settlement of a major federal lawsuit, the way real estate commissions work in the U.S. changed in August. The longstanding structure had been for home sellers to pay both their own agent’s commission and their buyer’s, but now, buyers may have to cover their own agent’s commission fee — which would obviously save sellers money.

How this might affect home prices and affordability remains to be seen. “The new rules mean buyers will have a say in how much they pay buy-side agents,” says Bankrate prinicipal writer Jeff Ostrowski. “Will commissions fall? Will buyers decide to do it themselves, without using buyers’ agents? It could be years before we know the answers.”

Ken Johnson, chair of the real estate program at the University of Mississippi, predicts little will change. “The settlement did nothing to lower the cost of operation for brokers,” Johnson says. “If anything, the cost of operation has been increased. Brokers will find a work around and go back to doing business pretty much as usual.”

Will housing sales decline?

The volume of home sales has continued to soften over the course of 2024: Existing-home sales in September were down by 3.5 percent from last year. However, this trend may pivot if mortgage rates dip further.

“The uncertainty over rates is a contributing factor to slow sales, as existing homeowners choose to stay in their current homes longer to see if rates will drop even further,” says Nina Gidwaney, head of refinance and home equity at Chase Home Lending.

Chen Zhao, who leads the economics team at Redfin, thinks prospective homebuyers may get something of a reprieve thanks to the Fed’s late-2024 rate cuts. “We are not expecting sales to increase dramatically [though], as rates are likely to remain above 6 percent.”

“Lower mortgage rates would help spur home sales activity,” says Selma Hepp, chief economist at CoreLogic. “Declines in mortgage rates [would] drive more sellers to trade their existing home and help add much-needed inventory to the market, leading to more transactions.”

Will housing inventory increase?

Speaking of much-needed inventory, housing supply remains low. It has been inching up, slowly, though: The overall number of existing homes on the market for sale as of September sat at 1.39 million units, up a healthy 23 percent from the previous year. Even so, that represents only a 4.3-month supply, still short of the 5 to 6 months usually needed for a balanced market.

More supply is beginning to appear, and this could be an early indicator of more home sales later.
— Lawrence Yun, Chief Economist, National Association of Realtors

“More supply is beginning to appear, and this could be an early indicator of more home sales later as consumers see more choices and home prices no longer perk up,” Yun says.

For inventory levels to improve significantly, though, there would need to be either a surge of homeowners listing their existing properties or a huge amount of new-construction homes hitting the market. Both seem unlikely before the end of the year.

Will home prices go down?

Housing prices have been on fire lately, culminating in historic highs — September’s median of $404,500 is the highest September price ever recorded by NAR. So will home prices drop before next year? Probably not: “Mortgage delinquency rates are at historic lows, and therefore, there are very few distressed property sales,” Yun said. “This will keep home prices steady, and they definitely will not decline in any meaningful way.

Zhao also noted that prices are intricately connected with housing inventory. “Sellers are likely to remain reluctant to give up their low interest rate for a much higher one, so inventory will remain constrained,” she says. “As more time passes, more homeowners may be ‘forced’ to sell due to life events, so inventory may rise from the current anemic levels, but it’s unlikely to increase much. That means that prices are unlikely to fall on a year-over-year basis, unless demand falters.”

Will the rest of 2024 be a buyer’s or seller’s market?

While inventory has been inching up, overall it is still tight enough that the seller’s market seems unlikely to change this year. “The current shortage of inventory suggests it would be hard to [become] a buyer’s market anytime soon,” says Hepp.

“Given expectations about interest rates and supply, demand will probably [continue to] exceed supply,” Zhao says. “Supply is likely to remain below what we would deem a balanced market.”

The plague of low inventory won’t be cured in the short-term.
— Greg McBride, Bankrate Chief Financial Analyst

“The plague of low inventory won’t be cured in the short-term, and it remains a competitive and frustrating process for first-time homebuyers in particular,” says McBride. “Buyers should be wary of biting off more than can be financially chewed. Home prices are at record highs, and insurance costs are up substantially in many markets. You’re not getting a bargain, and the willingness to walk away might prove to be a good choice.”

Bottom line on the 2024 housing market

The continued combination of high mortgage rates, steep home prices and low inventory levels appear poised to ensure that the remainder of 2024 is a challenging market for both buyers and sellers. But rates have cooled a bit — if that continues through the rest of the year, as some experts predict, then market activity should heat up in response.

The complexities of the current conditions mean that, now more than ever, it’s smart to lean on the guidance of an experienced local real estate agent. If you want to enter the market during the remaining months of 2024, whether as a buyer or a seller, let a pro lead the way for you.

FAQs

  • Maybe, but probably not significantly. Experts predict that higher rates will likely persist throughout the rest of 2024 — though hopefully, after reaching 8 percent in October 2023, the worst is behind us. “I believe we’ve already reached the peak in terms of interest rates,” NAR chief economist Lawrence Yun said at the company’s NXT conference in late 2023.

     

  • No — experts do not think a housing market crash is looming. Lending standards are much more strict now than they were before the Great Recession, and with low inventory and high demand both continuing, the housing market is not likely to enter a recession in the coming year.

  • Many prospective homebuyers chose to wait things out in 2023, in the hopes that 2024 would bring a more advantageous market. But with mortgage interest rates remaining relatively high and housing inventory remaining stubbornly low, it looks like the last few months of 2024 will remain a challenging time to buy a house. If rates continue to go down, though, that would alter the landscape — not only would it make the purchase more affordable for buyers, but homeowners locked into their previous lower rates might finally choose to sell, which would add much-needed inventory to the market.

     

Read the full article here

Sign Up For Daily Newsletter

Be keep up! Get the latest breaking news delivered straight to your inbox.
By signing up, you agree to our Terms of Use and acknowledge the data practices in our Privacy Policy. You may unsubscribe at any time.
Share This Article
Facebook Twitter Copy Link Print
What do you think?
Love0
Sad0
Happy0
Sleepy0
Angry0
Dead0
Wink0
Previous Article Trump’s Ambitious Inflation Plans | Bankrate
Next Article How To Get A Business Line Of Credit
Leave a comment

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

FacebookLike
TwitterFollow
PinterestPin
InstagramFollow
TiktokFollow
Google NewsFollow
Most Popular
7 Retirement Accounts With Perks Nobody Uses
June 6, 2025
What Is FICA Tax? What You Should Know About Payroll Taxes
June 6, 2025
How to Unlearn Generational Scarcity Without Blowing Your Budget
June 6, 2025
Supreme Court Sides With Catholic Group In Tax Exemption Dispute Over Non-Religious Activities
June 6, 2025
Can You Contribute to a Roth IRA Without Having Earned Income?
June 6, 2025
Is Your Homeowners Insurance Tax-Deductible?
June 5, 2025

You Might Also Like

Homes

Best 5% Cash Back Credit Cards

15 Min Read
Homes

Why Do Some Stores Have Credit Card Minimums?

8 Min Read
Homes

What Is Mortgage Collateral? | Bankrate

6 Min Read
Homes

How to “Give Yourself a Raise” When Inflation Cuts Your Pay

10 Min Read

Always Stay Up to Date

Subscribe to our newsletter to get our newest articles instantly!

Indestata

Indestata is your one-stop website for the latest finance news, updates and tips, follow us for more daily updates.

Latest News

  • Small Business
  • Debt
  • Investments
  • Personal Finance

Resouce

  • Privacy Policy
  • Terms of use
  • Newsletter
  • Contact

Daily Newsletter

Subscribe to our newsletter to get our newest articles instantly!
Get Daily Updates
Welcome Back!

Sign in to your account

Lost your password?