Lawrence Yun, the chief economist for the National Association of Realtors (NAR), forecasts that 4.71 million existing homes will be sold, the housing market is expected to grow, and Austin, Texas will be the top real estate market to watch in 2024 and beyond.
Yun predicts home sales will begin to rise next year – by 13.5 percent compared to 2023, and the median home price will reach $389,500 – an increase of 0.9 percent from this year. He forecasts that U.S. GDP will grow by 1.5 percent, avoiding a recession, with net new job additions slowing to 1.7 million in 2024, compared to 2.7 million in 2023 and 4.8 million in 2022. After eclipsing 8 percent in late 2023, he expects the 30-year fixed mortgage rate to average 6.3 percent and that the Fed will cut rates four times – calming inflationary conditions – in response to slower economic activity.
Yun also foresees 1.48 million housing starts in 2024, including 1.04 million single-family and 440,000 multifamily.
NAR identified 10 real estate markets with the most pent-up housing demand, which it expects to outperform other metro areas in 2024. In order, the markets are as follows:
- Austin-Round Rock-Georgetown, Texas
- Dallas-Fort Worth-Arlington, Texas
- Dayton-Kettering, Ohio
- Durham-Chapel Hill, North Carolina
- Harrisburg-Carlisle, Pennsylvania
- Houston-The Woodlands-Sugar Land, Texas
- Nashville-Davidson-Murfreesboro-Franklin, Tennessee
- Philadelphia-Camden-Wilmington, Pennsylvania-New Jersey-Delaware-Maryland
- Portland-South Portland, Maine
- Washington-Arlington-Alexandria, D.C.-Virginia-Maryland-West Virginia
“The demand for housing will recover from falling mortgage rates and rising income,” Yun said. “In addition, housing inventory is expected to rise by around 30 percent as more sellers begin to list after delaying selling over the past two years. The selected top 10 U.S. markets will experience faster recovery in home sales.”