Hard to believe that 2024 is just 6 weeks away. In the world of Real Estate in Long Beach and North Orange County, I am evaluating what how 2024 will unfold daily. Will it be the right time to
buy or
sell a home. With over 18 years experience, I’ve learned to look to the experts that have their fingers on the pulse of the industry -
Fannie Mae, the
Mortgage Bankers Association (MBA), and the
National Association of
REALTORS®
(NAR).
Spoiler alert: the projections may be better than you think. Here’s why.
Experts Forecast Ongoing Home Price Appreciation
On the left, the orange bars indicate an average of all the forecasts. Based on that, forecast
prices will end this year up about 2.8% overall, and increase by another 1.5% by the end of 2024. In Southern California (based on my 18+ years experience), we usually outpace the average by 100% or more. So we would be looking at close to, if not over, a 3% increase in values. Many may see that as a welcome surprise, considering so many us thought home prices in our area were headed toward a crash this year. Home 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. This is a sign that the inventory crunch is still very real. Limited supply of homes simply continues to put upward pressure on prices as we move into the new year. In fact, in Long Beach, monthly supply of homes is at 2.2 months where a balanced market is 6 months.
As we enter 2024, industry experts project
home prices will continue to rise next year, however 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, this means 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 home sales in 2023 were low compared to more “normal years” in the housing market, we are expecting 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):
Improved activity next year, albeit only a slight uptick, is a good thing for the housing market, and for
buyers and sellers like you. As people continue to move, that opens up options for hopeful buyers who are looking for a home.
So, what do these forecasts show? The housing market is expected to be more active in 2024. That may be in part because there will always be people who
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 thinking about buying or selling, it’s important to know what the experts are forecasting for the future of the housing market. When you’re in the know about what’s ahead, you can make the most informed decision possible. Feel free to reach out and I will gladly provide the latest forecasts in your neighborhood and talk about a plan for your next move about the latest forecasts together, and craft a plan for your next move.
