Real Estate Market Trends and Predictions
With Fall right around the corner, the real estate market is one of the many things that may be facing a tide of change. Below are market trends and predictions that we could see for the remainder of 2024.
Market Analysis: Supply, demand, and price trends
- Affordability remains a limitation on the housing market. The second half of 2024 will likely see a more balanced housing market, potentially even shifting towards a buyer’s market. Per Zillow, in June, about 25% of its listings received a price cut, which is the highest rate of cuts for that time of year since 2018.
- For housing to become more affordable, inventories of for-sale homes would need to be higher, which could be likely this Fall. This would then help relieve some pressure on the rising home prices.
- The best-case scenario would be a scaled pace of rate reductions of interest rates, that way inventory gains do not cause housing prices to rise again.
- Overall, the Arizona housing market is pretty positive and continued growth should continue in the remainder of 2024.
Economic Factors: Impact of interest rates and local developments
- The Federal Reserve will make its next rate decision on September 18.
- However, the average rate for a 30-year fixed mortgage was at 6.44% in late August, which is its lowest point since April 2023.
- This would be good news for homebuyers who could be attracted by the declining rates (the rates were about 7% earlier this year, in combination with record-high home prices).
- The Federal Reserve is likely to cut interest rates and rates could fall below 6% in the coming months.
Predictions: Market forecasts
- The housing market is impossible to time, but there is unlikely to be a housing market crash in 2024 due to the low supply of houses on the market.
Tips for Buyers
- The good news for buyers entering the Fall is that resale inventory could be increasing, as sellers get more comfortable with the lower interest rates, which would give buyers more options.
- The median price for a new home also has declined and is below the median resale home price, so this could open more options for people.
- Make sure to start saving and know your budget, to include how much you can afford as a monthly payment when factoring in the down payment, mortgage rate, loan term, home insurance, closing costs, and property taxes.
- Have some flexibility about home size and location, for example if a smaller home in your ideal neighborhood or a larger and newer home but further away would be preferred.
- Don’t get discouraged! A real estate agent can help manage all the ins and outs of home buying.
Tips for Sellers
- Although current rates will not be as attractive as the pandemic-era rates when they were around 3%, the news of rates dropping could entice sellers to make a move, especially if family circumstances like job changes or growing families have occurred.
- Research comparable prices to homes in your area and price your home appropriately.
- Have your home be in great shape – homes that have been well maintained and that have good curb appeal are still what buyers look for. Anticipate any maintenance that could be required.
- Get a real estate agent! We’re here to help you make a great deal and quickly!