2024 has been quite the year for the US economy! Experts started the year predicting we’d see multiple rate cuts from the Federal Reserve (Fed) which would help stimulate activity in the housing market as mortgage interest rates dropped in response and affordability increased. As 2024 is also an election year, most people also predicted buyers and sellers would make their moves early, with sales activity tapering off into the fall.
Yet inflation proved to be a challenging problem to combat. Now, we may only see one cut to the standard interest rate before the year is through. Across much of the US, a sudden rush of late summer activity is making up for what has been a relatively lackluster season for many local markets. Wondering what else you can expect in the months ahead? Check out our report on the US housing market trends shaping the second half of 2024!
The Inventory of Existing Homes Has Grown Substantially
One of the most important trends shaping the US housing market this fall is the substantial inventory growth most cities have experienced over the last year. Nationwide, the inventory of existing homes has grown 36.6% according to a July 2024 report from Realtor.com, with many cities and towns posting an even higher rate of growth. However, it’s important to understand that all this inventory growth does not mean the US housing market is about to take a bad turn. After years of the needle being firmly in the seller’s market territory, this shift marks a move toward normalization where both sides have equal leverage.
Builders Are Helping to Fill the Inventory Gap with New Home Builds
After the 2008 housing market crash, builders slowed the pace of new home builds. For over ten years, the rate of new homes completed in the US was way below what we saw in the preceding decades. Then the pandemic happened, and builders had to contend with both supply chain issues and the high cost of materials to complete their projects. Now, builders are finally starting to catch up. Keeping Current Matters recently reported that the last few years have marked a period of consecutive growth for this sector.
Curious about financing options for a new build home near you? Click here to get in touch with us at the Potempa Team!
Interest Rates May Inch Down Before the End of the Year
Thanks to a few key economic reports coming in under target this summer, mortgage interest rates have already moved down a bit from their high point earlier this year. However, with renewed speculation that the Fed will cut the standard interest rate after this September’s meeting, most housing experts predict we’ll see mortgage rates fall further before the year is through. If you held off on buying a home because affordability challenges priced you out of the neighborhood you really wanted to buy in, now is the time to speak with a lender at the Potempa Team and see what you may qualify for now!
With these three trends in play, this fall is expected to be a busier-than-normal season for the US housing market. Rather than the pre-election slowdown many expected, the pace of home sales appears to be picking up with more properties coming on the market every week. Meanwhile, many hopeful buyers have been tempted back into the market by lower mortgage interest rates. If you’re planning to make your move before the end of the year, we would love to help make your goals of homeownership a reality! Take the first step by clicking here and a member of our team will get back to you soon to discuss personalized financing options.
