Realtor.com® is the latest industry giant to release its 2024 housing market predictions.
Like Zillow, it expects next year’s housing market to bring some relief to homebuyers. But despite the fact that 35% of Americans would welcome a market crash, it’s not a likely scenario.
Here are five predictions from Realtor.com, along with its top 10 markets for the new year.
Realtor.com’s Predictions for the 2024 Housing Market
#1—Home Prices
Projections suggest a potential improvement in affordability in 2024, as home prices are expected to ease slightly, coupled with lower mortgage rates and income growth, resulting in a decreased mortgage payment share relative to median income.
#2—Home Sales
Heading into 2024, home sales are expected to remain around 4 million as high costs deter existing homeowners from moving. Sales driven by necessity, such as job changes and downsizing, are anticipated to play a significant role.
#3—Mortgage Rates
Realtor.com predicts mortgage rates will be 6.5% by the end of 2024, citing a continued improvement in inflation as the primary reason.
#4—Inventory
While builders have ramped up construction, particularly for multi-family units, the existing home market continues to face a scarcity of available homes for sale. Realtor.com expects a 14.7% drop in for-sale inventory in 2024.
A primary reason for continued low inventory, despite expectations of easing mortgage rates, is that the lock-in effect persists. A significant majority of existing mortgages have rates below 4%, and this will remain true in 2024.
#5—Rent Prices
After a year of double-digit rent growth, the rental market has cooled, with a projected mild annual decline of -0.2% in median asking rent in 2024 due to a balance between supply and demand. The surge in new multi-family supply, hitting a record high in units under construction, has led to a slight uptick in the rental vacancy rate, but it remains below pre-pandemic levels. The sheer number of renters is expected to limit the impact on prices, with renting remaining a more budget-friendly option than buying in most markets.
For more on its 2024 housing market forecast, head to Realtor.com.
Realtor.com’s Top 10 Housing Markets for 2024
In addition to its housing market predictions, Realtor.com also identified its top housing markets for 2024, focusing on anticipated sales and price growth.
Eight metros in the West are expected to see double-digit sales growth after experiencing declines in 2023.
Meanwhile, the top 10 markets for 2024 are split into two groups:
- Midwest and Northeastern metros offering affordability and insulation from higher mortgage rates
- Western metros rebounding from 2023 declines as interest rates fall.
Factors such as cultural amenities, recreational opportunities, and educational institutions contribute to the attractiveness of Midwest and Northeastern markets, making them appealing choices for a well-rounded, cost-effective lifestyle.
After ranking the largest 100 metros by their expected sale and price growth rates, Realtor.com’s top 10 housing markets for 2024 are the following:
- Toledo, OH
- Oxnard-Thousand Oaks-Ventura, CA
- Rochester, NY
- San Diego-Chula Vista-Carlsbad, CA
- Riverside-San Bernardino-Ontario, CA
- Bakersfield, CA
- Springfield, MA
- Worcester, MA-CT
- Grand Rapids-Kentwood, MI
- Los Angeles-Long Beach-Anaheim, CA
For a complete list of the top 100 markets for 2024, visit Realtor.com.
