1. Inventory Improvement in Various Markets
As we start to close out the first quarter of 2024, one notable trend is the anticipated improvement in inventory levels across many markets. Despite enduring challenges in affordability and pent-up buyer demand, Zillow economists project a gradual increase in housing inventory, particularly in regions like the Great Lakes and the Midwest.
2. Stabilization of Home Buying Costs
2023 witnessed unprecedented highs in home buying costs, with mortgage payments comprising over 40% of buyers' earnings. However, the forecast for 2024 indicates a leveling off of home values and mortgage rates, offering potential relief to buyers grappling with affordability concerns.
3. Shifting Buyer Behavior in Expensive Markets
In the face of persistent affordability challenges, more prospective buyers are opting out of homeownership in expensive markets. This demographic shift underscores the rising popularity of single-family home rentals, which are increasingly perceived as viable alternatives to traditional homeownership.
4. Rise of "House Hacking" Among Younger Buyers
Younger homebuyers, particularly millennials and Gen Z, are embracing the concept of "house hacking" as a means to generate rental income and offset housing costs. This trend reflects a broader shift towards innovative homeownership strategies that prioritize financial flexibility and income generation.
5. Increased Competition for Fixer-Uppers
With limited housing inventory, buyers are increasingly willing to invest in fixer-upper properties, leveraging sweat equity to address minor flaws and enhance property value. While facing competition from flippers, buyers are drawn to the potential long-term gains associated with renovating properties.
6. Rebound of Downtown-Area Rentals
Urban rental markets are experiencing a resurgence in demand, driven by the return of workers to downtown office hubs and the pursuit of post-pandemic amenities. Multifamily construction booms have expanded rental options, providing renters with increased flexibility and landlords with opportunities to attract and retain tenants.
In summary, the real estate landscape in 2024 is characterized by evolving buyer preferences, inventory dynamics, and rental market shifts. As we navigate these trends, we remain committed to providing valuable insights and support to our clients in their real estate endeavors.
Stay tuned for more updates and insights as we embark on this exciting journey through the 2024 real estate market!
Ayana Gavin
City RemixHer
Your Real Estate Plug!