By more measures than not, and the new year opens on a mood of optimism. Here at Eileen Townsend & Team, we are already busy bringing homes to market and helping buyers find their place in the Bay. With the stock market rallying, employment for the most part strong, and people having grown accustomed, if not comfortable, with higher interest rates, expectations are that 2024 will be a year of recovery in real estate. More buyers are ready and willing to buy, and a few more homeowners are stepping up to sell.
Here's where we’ve been and where we think we’re heading in 2024:
Interest Rates and Inventory will Continue to Drive our Market
BETTER INTEREST RATES: The biggest headline is that mortgage rates have dropped more than 2 percentage points in the past 2 months, from October’s peak national average of 7.79% in October, to rates hovering around 6.5% as the calendar turned to 2024. Interest rates, and their impact on Inventory (the number of homes available for sale) will continue to drive this year’s market
INCREASING INVENTORY: If you’ve wondered where all the houses for sale have gone, join the club! 2023 gave us a record-low number of homes to sell – the lowest inventory nationally in 20 years, and locally, the lowest in many more years. For Alameda County, for example, 9,346 homes sold in 2023 … down 45% from the recent high of 17,230 sold in 2021, and 33% lower than the 14,070 sold when we were in lockdown during 2020, the first year of the pandemic. The NAR (National Association of Realtors) tracks the number of homes sold nationally last year at 18% below the number sold in 2022. In other words, the local shortage of homes for sale is even more dire than national norms, and by this metric, Inner East Bay trends mirror Bay Area trends.
THE GOOD NEWS? Forecasts from NAR, the Mortgage Bankers Association (MBA) and others uniformly project that interest rates will continue to improve over the year, more homes will hit the market – as many as 14% more nationally – and more buyers will emerge. So … a good bounce, if not quite a massive rebound.
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