Is a balanced housing market on the horizon?

Last year’s unshakeable seller’s market may finally be letting up. 

Everest takes a look at some positive points on the ‘24 homefront. 

No doubt—it was a tough year for homebuyers across the board. 

Limited inventory, high interest rates, and equally high asking prices kept many buyers on the sidelines this past year. And while our Everest loan officers always work their magic (even in a competitive seller’s market), we wish more families were able to make their dreams come true. 

Nevertheless, all of this reflection has us wondering. 

Before we put a fork in ‘23, might we end the year on a happy note? 

Interestingly enough, many housing market analysts say things are finally looking up! A few recent developments signal great promise for home shoppers heading into ‘24. 

Let us explain. 

Looking back (and moving forward)

Before we make our ‘24 predictions, it’s important to understand where we’re coming from. Linda Friedman, Loan Officer at Everest Equity, offers a comprehensive perspective of the situation. 

“Indeed, 2023 has been tough for buyers in the housing market. Rates hit highs not seen in 20 years and inventory is very low. These factors contributed to countless bidding wars for homes, pushing up prices even higher.”

But like most other industry insiders, Mrs. Friedman sees the silver lining. 

“The outlook for 2024 is brighter,” she says. “Builders are stepping up to build more homes, rates seem to have reached their peak and are heading lower, and pent up demand is bursting out.” 

Over the past few weeks, economists have echoed Mrs. Friedman’s sentiments. Mortgage rates dropped for five consecutive weeks heading into December, prompting many experts to predict a continued downward trend through the end of the year. 

If the economy strengthens, inflation lowers, and rates dip further, ‘24 may actually bring us a more balanced housing market. Of course, this is all great news for buyers. 

“As inflation seems to be abating from its highs, rates will drop,” Mrs. Friedman explains. “Remember that inflation is the arch enemy of mortgage-backed securities, which offer a fixed rate of return. Rates had to rise to compensate investors for the reduced value of their returns. With the wars in Ukraine and Israel, uncertainty is pushing investors towards the relative safety of mortgage bonds. This will continue to push rates lower as we head into 2024.” 

In addition, it’s important to consider two other variables: inventory and pricing. 

Everest has compiled some end-of-year stats to help us predict what might happen in ‘24. There’s still some mild frustration and uncertainty on the horizon, but we’re thrilled to report some VERY encouraging trends affecting next year’s homebuyers. 

Check out the details below, and stick around for Mrs. Friedman’s top 3 tips for clients looking to enter the market. The message? Don’t wait! 

2023 Housing Market Recap

(and what it all means for 2024)

Home Prices

In October, the median list price clocked in at $425,000. By early November, median home prices rose slightly year-over-year, increasing by 0.7%. As Mrs. Friedman suggests, this could be attributed to the mortgage rate drops happening during the same period. 

But aside from some subtle jumps, home prices were mostly neutral through the first half of 2023. The hope is that we’ll finally see some numbers moving into the negative next year. 

New Listings

During the same period in November, new listings were up an incredible 6.4% from 2022! For many, many months, the number of new homes hitting the market was down year-over-year. 

The dramatic uptick is breathing new life into the market as more buyers come out of hiding. Compared to the stale situation we were working with earlier in ‘23,  these final weeks have been a shopper’s paradise. Fingers crossed it continues in ‘24. 

Overall Inventory

In addition to a recent rush of new listings, stats indicate a 0.6% jump in total inventory for the week ending November 11th. A slight increase—but an increase nonetheless! 

It’s important to note that housing is still overwhelmingly undersupplied and dramatically lower than pre-pandemic levels. But put into perspective, that 0.6% jump is very important, as it signals the first positive year-over-year metric in 20 weeks. 

Market Pace

November stats suggest things are heating up! By the end of the second week, listings were spending 2 fewer days on the market compared to 2022. Fun fact: the average listing lasted for 50 days during the month of October. 

If mortgage rates continue to decrease through ‘24, we expect to see even faster sales. Buyers can’t afford to wait around if they’re hoping to nab their dream home. 

3 Reasons to Close Now! 

Looking at the bigger picture, the market seems like a mixed bag of “good and bad.” Still, even the subtle ‘wins’ bring huge relief to today’s buyers. 

With many years of mortgaging on her resume, Mrs. Friedman has been advising clients not to wait for rates to drop even further. We know it’s tempting to wait for better borrowing conditions, but there’s excellent motivation to make your move now. 

Reason #1: “Once rates drop, sellers will jack up their asking prices. The cost of waiting is very high.” 

Reason #2: “Rates appear to be headed lower. Once a client owns the home, refinancing to a lower rate is always an option.” 

Reason #3: “With so many potential ‘wannabe’ homeowners coming out of hiding, the longer you wait, the tougher the competition will be.” 

Everest says: If you want to move, make your move! 

Since 2004

20 Years of Mortgage Excellence

For two decades, Everest Equity has helped thousands of clients

 achieve their homebuying dreams. Reach out to an expert loan officer

 today to make ‘24 your most memorable milestone yet!