What is ahead for the 2024 Housing Market
As we step into the new year, the real estate landscape is undergoing a shift. Economic experts anticipate a decline in rates, witnessed slightly in December 2023, signaling an upcoming surge of buyers and sellers entering the market.
Understanding that real estate is constantly evolving due to economic factors, generational trends, and societal shifts, let's delve into the key elements shaping the housing market in the coming years.
Interest Rates and Their Impact
Interest rates significantly influence the housing market. For a 30-year fixed mortgage, interest rates fluctuate, but over the last three decades, they have hovered in the 5-10% range. The highest recorded rate was 18.6% in October 1981.
As of January 8, 2024, 30-year mortgage rates are below 7%.
The Impact of Millennials
Housing demand is poised to surge with millennials, the largest generation of potential homebuyers. With 72 million in total, and aged between 28 and 43 in 2024, an estimated 45.5 million potential first-time homebuyers are ready to enter the market, especially as interest rates continue to decline.
The Influence of Baby Boomers
Baby Boomers, born between 1946 and 1964, play a vital role, representing the largest group of current homeowners.
Comprising 52% of all home sellers, their decisions impact housing availability and prices. Anticipated interest rate decreases may prompt potential sellers to act, contributing to market dynamics.
Average Homeowner Equity
Another key factor in the housing market is homeowner equity. The average homeowner equity currently stands at a significant $274K. This can offer significant options for relocation, upgrading, or downsizing.
Reasons People Move
Understanding why people move provides insights into the housing market.
Top Reasons People Move
Do any of these sound like you?
To be closer to family and friends.
Need more space.
Love their rate, but not their house.
Want a better neighborhood.
Want a vacation home.
Lots of equity means lots of choices.
Legacy real estate.
Time to downsize.
Out-of-area relocation.
Change of work or life.
Considering a move in 2024 or beyond? Let's discuss your situation and explore whether it's the right time to sell or buy a home. It looks like a promising year for either decision!
