The new year is approaching, and you might wonder if 2024 will be the right time to buy or sell a home. To make the most informed decision possible, it’s important to know what the experts say about what’s ahead for the housing market. Spoiler alert: the projections may be better than you think.
Here’s why.
Experts Forecast Ongoing Home Price Appreciation
Take a look at the latest home price forecasts from Fannie Mae, the Mortgage Bankers Association (MBA), and the National Association of Realtors (NAR):
As you can see in the orange bars on the left, on average, experts forecast prices will end this year up about 2.8% overall and increase by another 1.5% by the end of 2024. That’s big news, considering many people thought prices would crash this year.
The truth is, prices didn’t come tumbling way down in 2023, and that’s because there just weren’t enough homes for sale compared to the number of people who wanted or needed to buy them, and that inventory crunch is still very real. This is the general rule of supply and demand, which continues to put upward pressure on prices as we move into the new year.
Experts project home prices will continue to rise next year, but not quite as much as they did this year. Even though the expected rise in 2024 isn’t as big as in 2023, it’s important to understand home price appreciation is cumulative.
In simpler terms, if the experts are right, according to the national average, after your home’s value goes up by 2.8% this year, it should go up by another 1.5% next year. That ongoing price growth is a big part of why owning a home can be a smart decision in the long run.
Projections Show Sales Should Increase Slightly Next Year
While 2023 hasn’t seen a lot of home sales relative to more normal years in the housing market, experts are forecasting a bit more activity next year. Here’s what those same three organizations project for the rest of this year and in 2024 (see graph below):
While expectations are for a slight uptick in total sales, improved activity next year is a good thing for the housing market and buyers and sellers like you. As people continue to move, that opens up options for hopeful buyers looking for a home.
So, what do these forecasts show? The housing market is expected to be more active in 2024. That may be partly because people will always need to move. People will get new jobs, have children, get married or divorced – these and other major life changes lead people to move regardless of housing market conditions. That will remain true next year and for years to come.
And if mortgage rates come down, we’ll see even more activity in the housing market.
Bottom Line
If you’re considering buying or selling in the Chicagoland area and surrounding suburbs, it’s important to know what the experts are forecasting for the housing market’s future. When you know what’s ahead, you can make the most informed decision possible. Let’s discuss the latest forecasts together and plan your next move.
