The Bright MLS 2024 National Housing Market Outlook predicts that next year will bring better conditions for homebuyers. Despite the challenges posed by affordability, buyers can expect a slowdown in home price growth, lower mortgage rates, and an increase in housing options. This shift will occur as life events prompt current homeowners to enter the market, providing more opportunities for prospective buyers.
The Bright MLS 2024 National Housing Market Outlook forecast signals several critical developments for buyers and sellers:
Home sales will increase next year, following a prolonged period of subdued activity. In 2023, the housing market experienced a notable decline in home sales, reaching the lowest level since 2008 because of limited inventory, heightened mortgage rates, and soaring home prices, which dampened demand, particularly in the latter part of the year.
Nevertheless, there remains substantial pent-up demand for homeownership, particularly among younger households, whose homeownership rate still lags because of previous generations. Lower rates and increased inventory will drive the anticipated influx of buyers in 2024. However, affordability will remain a significant challenge, potentially deterring some prospective buyers from entering the market in 2024.
The housing market will likely experience relatively stable home prices in 2024, with a modest 1.5% increase in the median home price in the U.S. compared to 2023. Factors like inventory offset by a rise in the number of buyers in the market will drive the projected growth in home prices.
Overall, the median home price in the U.S. will grow modestly, rising to $394,200 in 2024, a 1.5% increase over 2023.
In 2024, the U.S. housing market will not experience widespread price corrections. However, certain local markets have seen rapid price increases, posing affordability challenges for potential buyers. Additionally, some metropolitan areas have witnessed a surge in new construction activity.
This surge and decreased affordability may lead to price declines in particular markets nationwide. Based on an analysis of price growth, affordability, and construction trends, 10 of the 50 largest metro areas are forecasted to have lower median prices in 2024 compared to 2023. Notably, California and Florida dominate the list of regions with forecasted price declines, although no market is anticipated to experience a double-digit price drop next year.