Expert Forecasts Revised up

The latest data and market signals from over the past few months have been reviewed. Many of the top experts have now revised their 2024 home price forecasts and they’re even more confident prices will rise, not fall this year. Let’s take a closer look at how and why things have changed.

The chart below shows what seven expert organizations believe will happen to home prices in 2024 when compared to their original forecast made at the end of 2023.

There are two big factors keeping such strong upward pressure on home prices, low inventory and mortgage rates. A lack of housing inventory has been pushing prices up for a long time now – and that’s not expected to change dramatically this year. But what has changed a bit is mortgage rates.

Now that rates have come down from their peak last October, and with many expecting rates to drop to 6% or below over the course of the year, buyer demand has picked up. That increase in demand, along with an ongoing lack of inventory, is what’s caused the experts to feel the upward pressure on prices will be stronger than they expected a couple months ago.

Real estate experts will continue to revise their projections as the housing market changes, just as they’ve always done. How those forecasts change next is anyone’s guess. If mortgage rates trend down as the year goes on, as they’re expected to do, that could lead to more buyer demand and even higher home price forecasts.

The bottom line is this. At first, experts believed home prices would only go up a little this year. But now, they've changed their minds and forecast prices will grow even more than they originally thought. Of course, all of these are national averages. We are lucky to live in an area the usually outperforms the national averages. Contact Arrive Real Estate Group for more information on our local real estate market.