SEATTLE — Home buyers will have “a bit more breathing room, but only a bit” in 2024 as the housing market begins “a long healing process” from the challenges it faced last year, a leading real estate market firm is predicting.
According to Zillow Group, Inc., the Seattle-based real-estate website, buying a home in 2024 “will remain expensive” in the face of stubbornly high mortgage rates, while many people who buy will turn to homes that need do-it-yourself upgrades and other forms of renovation. However, “while still presenting challenges, the market will be better for buyers, with more homes to choose from and improved affordability,” Zillow predicted.
“I expect the beginning of a long healing process to kick off in the housing market,” said Zillow Chief Economist Skylar Olsen. “We know there are a huge number of households in prime home-buying ages waiting for the winds to turn in their favor. This is our breather year.”
Olsen predicted that more resales, a critical impetus for residential remodeling, will hit the market in 2024 “as homeowners accept that current mortgage rates are sticking around.
“It has become clear that high mortgage rates have some staying power,” said Olsen, adding that Zillow economists expect more homeowners who locked in long-term payments when rates were near all-time lows to list their homes for sale, “as they grow weary of waiting for the historically low rates of 2021 to return.”
“More homes on the market would be good news for buyers, spreading demand and slowing price growth,” Olsen observed.
Zillow’s latest forecast calls for both existing-home values and mortgage rates to “hold steady” in 2024, allowing time for wages and buyers’ savings to grow – “welcome news after the rapid rise in housing costs over the past two years.”
“Typically the target of home-flippers, homes that need a little work before they qualify for ‘dream home’ status will see increased interest from buyers looking to move in,” Zillow said.