10 Feb February 2024 Real Estate and Mortgage Report
There is a narrative we must combat in the real estate market. The latest Fannie Mae report showed 24% of consumers believe their prices are going to depreciate over the last 12 months. We actually had a very strong 2023 and we’re going to finish this year between five and six percent appreciation.
Insights
We anticipate that after the past several years of extreme volatility in interest rates, the 30-year fixed rate mortgage rate will continue to moderate over the course of 2024, moving toward a rate below 6 percent by year end.
Doug Duncan, Senior VP and Chief Economist, Fannie Mae
Geographic patterns in price gains continued to favor housing markets in the Northeast and the South, especially those that remain more affordable and have lagged in home price increases over the past couple of years.
Dr. Selma Hepp, Chief Economist for CoreLogic
Forecasts
What’s taking place with future home appreciation? The latest reporting of the major forecasters, shows that on average, when we average all eight together, the expectation is a 2.7% home price appreciation. Since November, many of the forecasts appear more optimistic and have increased their projection by upwards of 3%.
Rates
Three months ago, four months ago, rates were at 8%. They’re now at seven. That means they went down a full percentage point. Looking at Q3 and Q4 of 2024, Fannie Mae is predicting rates of 6% and lower. Where are rates going to be a year from now or six months from now is what’s important, not where rates are going to be 60 seconds from now.
Affordability
The Housing Affordability Index measures whether or not a typical family earns enough income to qualify for a mortgage loan on a typical home at the national and regional levels based on the most recent price and income data.US Fixed Housing With home prices are lower than they were a year ago, the affordability Index is at a current level of 101.90, up from 94.20 last month and down from 109.30 one year ago. This is a change of 8.17% from last month and -6.77% from one year ago.
Inventory
In the Realtor.com® January Housing Report, we learn that January 2024 marks the third consecutive month of annual inventory growth. With the rise in inventory, median listing prices remained relatively stable, experiencing a growth of 1.4% compared to the same time last year, while time spent on market dropped to more than two weeks shorter than pre-pandemic levels. Things are moving quickly! Compared to January 2023, the typical home spent four less days on the market.
Prices
According to The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, November’s year-over-year gain saw the largest growth in U.S. home prices in 2023, with our National Composite rising 5.1% and the 10-city index rising 6.2%. Detroit held its position as the best performing market for the third month in a row, accelerating to an 8.2% gain. San Diego notched an 8% annual gain, retaining its second spot in the nation. Barring a late surge from another market, those cities will vie for the ‘housing market of the year’ as the best performing city in our composite.
Sales
In December 2023, sales slipped in the Midwest and South, rose in the West and were unchanged in the Northeast. All four regions experienced year-over-year sales decreases. There were 347,000 home sales in December 2023, compared to 374,000 in 2022 and 574,000 in 2021.
More Charts…
Do you love housing data? Whether you are a real estate expert or just learning about the market, this is the housing data to know. Enjoy 50+ charts illustrating the key metrics for the month.