Neighborhood Expert: Real estate predictions for 2024

Laura Schwartz is a licensed Realtor in VA and D.C. with McEnearney Associates in Vienna. You can follow Laura on Instagram at @LauraSchwartzRealtor or her Facebook page. Laura can be reached at 703-283-6120 or Laura@GuidingYourMove.com.

Wishing you all a very Happy New Year!

Many people will begin the process of moving in 2024 shortly, as our “spring market” usually starts to pick up in mid January. As I do every year, I wanted to give you my predictions for the market in 2024. 

First, a quick summary of what happened in 2023. Rates went all the way up to 8% in October, which is the opposite of what most experts thought would happen. Thankfully, we’re headed in the right direction now with rates in the mid 6s. Inventory remained tight, which is fueling an already rough market for buyers. Combining a lack of inventory with higher costs made affordability tough because prices stayed high. We saw some houses sit for a bit on the market, but others got multiple offers. 

So what’s in store for us in 2024? Here’s what I hope to see:

• Rates will continue to decline. The more rates go down, the better the market will be. I’m sure you’ve seen all the memes and headlines that people might hate their homes but they love their mortgage, and who wants to give up a 3% interest rate? Not many people. That’s why inventory levels are so low — nobody wants to sell! So the lower rates go down, the more sellers will enter the market and we need that inventory to keep things moving.
• Inventory will get slightly better. We’ve had low inventory in Northern Virginia for over 10 years. This isn’t a new problem, it’s just a problem that’s gotten much, much worse. So going back to point one — if we can make buying a little more attractive, we can shake some inventory free. Especially if we can make the “forever homes” more available, all of the home owners in condos/townhouses/smaller homes could move up, and that opens the door to first-time buyers. It’s all a cycle!
• Competition will stay. For every rate drop, more buyers enter the market who are competing for the same number of homes. Hence, bidding wars. I expect those to be a factor in our market… again/still.
• Prices will stay stable or increase. Your equity is safe in your home. We’ve had this perfect storm of pricing increasing for years. And without more inventory, the demand just outweighs the supply so prices will not go down. 

Perhaps not the news you wanted if you’re a buyer, but education is armor, so the more you have the better equipped you will be to make decisions that feel right for you.

If you’re thinking of selling or buying, or need to do both, let’s have a conversation about your unique position. There are individual strategies for everyone to help you get from point A to point B.