Whether you’re a first-time homebuyer, real estate investor, realtor, real estate agent, loan officer, or just someone who wants to learn more about the industry this 2024 you might want to read this!
The Simpson Team is off to a hectic start in 2024.
Pre-approvals, purchases, refinances, and lots of exciting conversations with new/past clients and our referral partners. I am hearing a much more positive tone, and mindset and everyone seems to be much more positive about the real estate market going into 2024.
We are starting off 2024 much different than 2023. 2023 started with a hawkish fed, rate hike talks, rates very volatile, recession talks, inflation still high, consumers still had more cash and credit card buying power, and much more.
2024 is starting off with a dovish FED, rate cut talks, rates trending down, inflation lower, consumer slowing down, job market softening, rates much lower than 8%, still inventory problems, election year and people sense that rates will be lower at the end of the year then they are now which is much more positive for the real estate market.
Real Estate Mindset: Buyers are getting smarter but we’ve still got INVENTORY PROBLEMS
Buyers seem to understand that when rates go lower there will be more competition and more buyers in the market. What NO one knows is whether will there be enough inventory to meet that demand. The majority of people think there will NOT be enough inventory and that there will be more bidding wars, buyers overpaying and buyers will wish they purchased earlier in the year when rates were higher and less competition.
I don’t recall having a conversation with anyone this year who thinks if they wait they will get a better deal, sure some buyers have to wait because they need rates lower to qualify or there are a few that know it will be harder to buy later but they want lower rates. Buy NOW and refinance later are on most buyers’ minds if they can do it and they realize it will be a much better path for them.
THE BIGGEST REAL ESTATE MINDSET SHIFT
The biggest mindset shift for the real estate market in 2024 is because they believe rates will be lower by the end of the year and that is great news for the real estate market. It is much easier to feel positive about the real estate market when we know the economy, FED, rates, and overall fundamentals are headed in the right direction for the real estate market when starting off a year.
Rates and inflation are going to move slowly lower and lower but this will take time unless something breaks sooner. Interest rates at the end of 2023 had a 1.5% drop, that is BIG and I don’t see rates falling off a cliff anytime soon. Data and fundamentals in the real estate market and economy must keep falling in line for rates to keep dropping. It seems that inflation, the job market, FED rate cuts, and other factors will slowly keep going lower over 2024 and that would mean rates will follow.
We will keep watching the data daily, weekly, and monthly to determine where we are headed. There is always a lot of stuff going on out there that can change the data and based on that the consumer can change their mindset. I am feeling very positive for home buyers, real estate investors, and borrowers who need to refinance that there will be more opportunities in 2024 in the real estate market.
