With home prices at historic highs and inventory still extremely low, along with significant commission anticipated changes this summer, many potential sellers and eager buyers feel jittery about the current housing market.
According to the National Association of Realtors (NAR), the median sale price for existing homes in the U.S. hit a record high of $393,500 as of March 2024. Meanwhile, although the average 30-year mortgage rate dropped to 7.23 percent in early May 2024 from over 8 percent in October, it remains considerably higher than most homeowners have locked in.
Looking ahead, factors like home prices, mortgage rates, inventory levels, and commission structures will all affect housing affordability in the upcoming year. Curious about where these trends might lead? Keep reading to discover what the experts anticipate for the second half of 2024.
What will happen with the housing market in the second half of 2024?
Good news for home buyers this year! Their main struggles — high mortgage rates and a shortage of homes for sale — are starting to improve. The average 30-year mortgage rate in early February was 6.63%, down from previous highs. And more homes are coming onto the market, too: December 2023 saw a 9.1% increase in new listings compared to last year.
And there’s even more good news: experts predict mortgage rates will continue to drop throughout the year, with some projecting rates around 6.5% by the end of 2024. This might not seem like a huge difference, but a $300,000 loan could mean saving $100 a month on mortgage payments, which can add up.
Home prices are expected to dip slightly in the second and third quarters compared to last year, offering some relief for buyers. The market for new homes is looking up, too, with a significant increase in housing starts compared to previous months, suggesting a strong year ahead for new home sales.
Tips for buyers navigating the real estate landscape in 2024
It seems like the intense bidding wars and crazy spikes in home prices are calming down, at least for now. This year, there’s some good news in store for those looking to buy a home. With borrowing costs easing up and more homes hitting the market, you can find your dream home better. According to Redfin, we’re looking at around 4.3 million home sales in 2024, marking a 5% increase from last year.
Here’s what you need to do to navigate this year’s market:
Keep an eye on new listings
Even though there’s more inventory available, homes are still selling fast. On average, properties were flying off the shelves in just 29 days back in December 2023. Those move-in ready homes tend to vanish quickly, especially. Stay updated on new listings to increase your chances of snagging the right home. Websites like Realtor, Redfin, and Zillow let you set up real-time notifications for new properties that match your criteria.
Find a real estate agent who knows their stuff
With over 3 million real estate agents out there, finding the right one is crucial. Find a real estate agent who’s an expert in your local market. Online directories like RealEstateAgent.com can help you find active agents in your area. Having a real estate agent who knows the ins and outs of your market is invaluable.
Explore down payment assistance programs
Coming up with a down payment can be challenging. But there are programs out there to help eligible buyers cover those upfront costs. These programs offer grants, low-interest loans, or other forms of assistance. Check out tools like Down Payment Resource to see if you qualify for any programs.
Get your finances sorted
Most buyers rely on a mortgage to buy a home. Getting pre-approved for a mortgage gives you a clear idea of how much you can borrow, making your home search more focused. Since interest rates can vary, shopping around for the best deal is wise.
Make your offer stand out
In a competitive market, you should up your game. Consider making a higher down payment to show sellers you’re serious. Including a home inspection contingency is also smart, giving you peace of mind about the property’s condition.
Don’t overlook new construction
Buying a brand-new home might seem out of reach, but developers often offer incentives to lure buyers. Look for deals like mortgage rate buy-downs or closing cost assistance. These perks can make new construction more affordable than you think.
Tips for sellers navigating the real estate landscape in 2024
With evolving market dynamics driven by economic fluctuations, shifting buyer preferences, and technological advancements, sellers must adopt strategic approaches to maximize their success. Understanding current market trends, leveraging digital tools, and effectively staging and marketing properties are crucial.
Set the Right Price
Avoid the temptation to overprice your home. In today’s market, buyers are very price-conscious. Working with a knowledgeable local agent can help you determine a competitive listing price based on recent sales in your area.
Curbside Appeal Matters
Don’t underestimate the power of a good first impression. Invest in landscaping and exterior maintenance to enhance your home’s curb appeal. Research shows that a well-kept exterior can significantly increase a home’s perceived value.
Minor Improvements Pay Off
While major renovations can be costly and time-consuming, smaller upgrades like fresh paint and basic lawn care can offer a high return on investment. Opt for neutral colors to appeal to a broader range of potential buyers.
Professional Presentation
Invest in professional photography for your listing. High-quality images can make your home stand out online and attract more interest from potential buyers.
Embrace Smart Technology
Consider adding smart home features like a video doorbell or smart thermostat. These modern amenities can make your home more appealing to tech-savvy buyers.
Offer a Home Warranty
A one-year home warranty can give buyers peace of mind, especially if your home has older appliances. It’s a relatively inexpensive way to reassure potential buyers and protect them from unexpected expenses.
Consider Concessions
Offering concessions such as covering closing costs or providing a mortgage rate buy-down can make your listing more attractive to buyers, especially in a competitive market.
Upgrade Your Kitchen
The kitchen is often considered the heart of the home. Investing in high-quality appliances and modern amenities can significantly increase your home’s value and appeal to buyers.
Utilize Social Media
Pay attention to the power of social media when marketing your home. Platforms like Facebook and Instagram can help you reach a broader audience of potential buyers, particularly younger demographics.
Explore Renting
If selling isn’t your only option, consider turning your home into a rental property. With low interest rates, renting out your home could potentially cover your new mortgage costs, depending on your local rental market.
Conclusion
As we venture into the latter half of 2024, the real estate scene is abuzz with changes that have both buyers and sellers on edge. With home prices soaring and inventory remaining tight, along with anticipated commission adjustments, a sense of cautious optimism is in the air.
In the year’s first half, we saw record-high home prices and a slight dip in mortgage rates, offering some relief to buyers. Experts predict further drops in mortgage rates and an uptick in housing inventory, which could ease the intense competition.
Buyers can expect a slight dip in home prices and a strong market for new homes. Critical strategies for buyers include keeping an eye on fresh listings, finding a knowledgeable agent, exploring down payment assistance, and being financially prepared.
On the other hand, sellers should focus on setting the right price, enhancing curb appeal, and utilizing professional marketing. Offering concessions and considering rental options could also boost their chances of success.
In summary, while uncertainties remain, the latter half of 2024 presents opportunities for buyers and sellers. By staying informed and employing strategic approaches, individuals can confidently navigate the real estate landscape.
