There is certainly no lack of news about what we should expect from the economy as we head into 2024 and, particularly, the housing market – both nationally and in Ohio and surrounding areas. So let’s look at what industry experts are saying about the current housing market, and what we should expect in the coming year.
New home construction jumps, raising hopes for better housing market
U.S. companies broke ground on a surprisingly high number of houses in November. Housing starts rose 9% from a year ago, primarily because of an 18% increase in starts on single-family houses. Housing demand has been overwhelmingly strong since the Covid-19 pandemic began as more millennials started families, and more people were able to do their jobs remotely, so this could be good news for buyers.
Lawrence Yun, chief economist for the National Association of Realtors, noted that even with the increase in starts in November, construction would have to increase even further to meet demand. “Home price appreciation can only moderate from drastically improved supply. Another 30% rise in home construction can easily be absorbed in the marketplace, especially in light of recent weeks’ plunge in mortgage rates.”
The 10 Hottest Housing Markets in 2024, According to Zillow Predictions
Low inventory, record-breaking home prices, and elevated mortgage rates have sidelined many homebuyers over the last few years. They’re expected to finally cool in 2024 — and prices could even see significant slowdowns in some fast-growing markets — but Zillow says these challenges probably won’t disappear entirely.
It is expected that homebuyers will flock to places where hurdles that have thwarted many before aren’t as prevalent and the Midwest is certainly one of those regions. Zillow’s analysis is based on forecasted home value growth, recent housing market activity and projected labor market changes, home construction activity, and existing homeownership. Among the cities expected to have the hottest housing markets this year are Cincinnati (#2), Columbus (#3), and Cleveland (#8).
Economists: Turnaround in Home Sales Likely in 2024
During the recent Real Estate Forecast Summit hosted by the NAR experts agreed that better days are ahead for the real estate market. Mortgage rates likely have peaked and are now falling from their recent high of nearly 8% and NAR predicts the 30-year fixed-rate mortgage to average 6.3% in 2024.
This likely will improve housing affordability and entice more home buyers to return to the market, according to NAR Chief Economist Lawrence Yun. NAR also is projecting that existing-home sales will rise 13.5% and new-home sales—which are up about 5% this year, defying market trends—could increase another 19% by the end of next year.
