The housing market in the U.S. in 2024 is expected to be more favorable for buyers compared to previous years. Here are some key trends and predictions from the BNS review:
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Price Fluctuations: In certain regions, especially in parts of coastal Florida, prices are expected to fall significantly due to factors like increased climate disaster risks and inflated prices during the pandemic. However, in more climate-resilient and affordable metros like Albany, Rochester, and Grand Rapids, prices are likely to rise.
Inventory Increase: The supply of homes is anticipated to increase as new home construction rises and more homeowners who were hesitant to sell during the pandemic enter the market. This could lead to more options for buyers and potentially lower prices.
Affordability Concerns: Although home prices have been at record highs, the affordability issue, combined with rising interest rates, might lead to a decline in demand and therefore a stabilization or slight decline in prices.
Mortgage Rates: Mortgage rates are predicted to trend a bit lower than they were in 2023. Organizations like Fannie Mae, the Mortgage Bankers Association, and the National Association of Realtors forecast that the 30-year mortgage rate will fall to below 7% in the second half of 2024.
Housing Market Stability: 2024 is expected to bring more stability to the housing market. With mortgage rates declining faster than expected, home prices are likely to remain mostly flat throughout the year. This could be good news for buyers who have been waiting for a more stable market.
Continued Seller's Market in Some Regions: Despite the overall trends, the national housing shortage is expected to continue, making it a seller's market in many regions. The National Association of Home Builders predicts that this shortage will last through the end of the 2020s.
Impact of Climate Change: The rising cost and consequences of climate change will impact the housing market, with buyers and builders needing to consider the costs of building homes that are resilient to climate change and extreme weather events.
While 2024 may offer more favorable conditions for homebuyers compared to the recent past, with potentially lower mortgage rates and increased inventory, regional variations and the ongoing impact of factors like climate change and national housing shortages will play a significant role in shaping the market. As always, local market conditions can vary greatly, so it's important to consider these trends in the context of specific regions and personal circumstances.
Based on current information, several cities in the U.S. are considered promising for real estate investment in 2024, with the potential for lower values this year and rising equity in the coming years. Here are some of the top cities according to the BNS review:
Bangor, Maine: Known for a significant net migration and a considerable one-year home appreciation rate.
State College, Pennsylvania: This city has seen a noteworthy net migration and a healthy appreciation in home values over the past year.
Richmond, Virginia: Richmond has experienced a substantial net migration and a strong rate of home appreciation.
Phoenix, Arizona: Phoenix stands out for its population growth and affordability, making it a notable choice for investment.
Tampa, Florida: Tampa has seen significant growth and offers a blend of affordability and economic strength.
Denver, Colorado: Despite being the most expensive city on the list, Denver's strong job market and quality of life make it an attractive investment destination.
Austin, Texas: Austin and other tech hubs are expected to gain momentum due to their blend of affordability, infrastructure, and growing tech talent pool.
Raleigh and Charlotte, North Carolina: Both cities are highlighted for their low cost of living and healthy job markets, making them ripe for investment.
Louisville, Kentucky: Louisville is emerging as a top market for investment opportunities due to its affordability and the growth of remote work.
El Paso, Texas: El Paso's population growth and affordable housing market make it an attractive option for investors.
Tallahassee, Florida: With a robust housing demand driven by a strong economic and employment climate, Tallahassee is a city to consider for investment.
Durham, North Carolina: Durham is known for its low cost of living and strong job market in the health care and high-tech sectors.
Birmingham, Alabama: Birmingham has been transforming into a hub for various industries and offers a unique affordability in the real estate market.
Las Vegas, Nevada: Known for its high appreciation rate in home prices and a promising rental market, Las Vegas is a key city for investors.
Dallas, Texas: Dallas attracts investors due to its rapid job and population growth coupled with relative affordability.
These cities offer a range of opportunities depending on what you're looking for in a real estate investment, whether it's population growth, job market strength, affordability, or a combination of these factors.