Key Trends and Forecasts in the Housing Market for 2024

The spring home-buying season has yet to spring to life, primarily due to an unexpected rise in mortgage rates exacerbating affordability challenges. Existing home sales have stagnated, while newly built home sales are thriving. However, tepid demand for existing homes is helping boost the country’s low housing supply.

In April, a judge preliminarily approved a landmark $418 million real estate broker commissions settlement centering on the National Association of Realtors (NAR). The new rules mandating significant changes to the industry’s long-standing buying and selling model will begin in July.

Despite the challenges, Fannie Mae forecasts an increase in home sales transactions compared to last year in 2024. Experts also anticipate a slower increase in home prices compared to recent years, with regional variations depending on local market supply.

The housing market is facing several conditions that need to unfold for a recovery to occur. Keith Gumbinger, vice president at HSH.com, emphasizes the need for higher inventories of homes for sale to ease upward pressure on prices. Mortgage rates cooling off is also crucial, but the timeline for this development is uncertain.

The NAR settlement will bring significant changes to the buying and selling process, including decoupling seller and buyer commissions in the MLS and requiring written representation agreements with buyers. The impact of these changes on buyers, especially first-time buyers, is a cause for concern among real estate agents.

Overall, the housing market is facing challenges, but there is optimism for a recovery in 2024. Experts suggest that buyers and sellers should be prepared for changing market conditions and work with local real estate agents to navigate the evolving landscape.