Home buyers looking for relief from rising prices can expect a mixed bag in 2024, as one housing expert predicts prices to keep moving higher next year, though price growth should decelerate at some point.
Nick Ron, founder and CEO of House Buyers of America, expects average home prices in the U.S. to rise around 3 to 4% next year.
“But at some point in 2024, I see a slowdown in price growth,” Ron explained in email comments shared with GOBankingRates. “The slowdown will be due to a combination of factors such as rising interest rates, an increase in the supply of homes, a decrease in demand, and affordability challenges for buyers. That said, I’m not anticipating a drop in prices nationwide. Rising construction costs and a slowing economy as a result of prolonged high-interest rates will also impact the housing market in 2024.”
US Housing Market Continues To Present Challenges (and Opportunities)
For buyers, the housing market continues to pose challenges in terms of finding available homes for sale. In October 2023, the number of homes actively for sale fell by 2% from the previous year, according to the latest Realtor.com data. The total number of unsold homes fell by 3.7% (including those under contract), while there were 3.2% fewer newly listed homes.On the bright side, the national median list price fell to $425,000 in October from $430,000 in September and held steady compared with prior years. At the same time, listing prices “have been buoyed” by scarce inventory, Realtor.com noted. And although new home sales have been increasing, construction activity isn’t elevated enough to “fully bridge” the low inventory gap.
As to whether 2024 will be a buyer or seller’s market, Ron said he expects it to be a seller’s market because of the national housing shortage. This could lead to a shift in how house hunters go about purchasing homes.
“I expect to see more buyers join with friends and family members to purchase homes, as intergenerational households, grown children boomeranging homes, and families created from friendships increasingly pool multiple income sources to purchase homes and avoid the uncertainty of housing costs as renters,” Ron said.
