What's Up Real Estate - January

I hope you all had a joyous holiday season and are recharged for an exciting year ahead. As we approach the spring/summer selling season, there are plenty of reasons to be optimistic about the real estate market. 🏡💫

📉 Mortgage Rates and Market Dynamics: Let's start with the good news – since October last year, mortgage rates have seen a decline of just over 100 basis points. This shift, along with the likelihood of the Fed beginning to cut short-term rates in the coming months, is a positive sign. While home inventory is showing signs of improvement, it's noteworthy that home sales dipped by 1% MoM in December. Despite the easing in rates and an uptick in inventory, the annualized rate of home sales stood at 3.78 million units – a figure that raises some questions. Are we on the cusp of a market shift? It's a point to ponder, especially considering that 2023's total home sales were the lowest since 1995.

🔍 Real Estate Market Cycle Insights: As we analyze the cycle, questions arise: Are we seeing a price adjustment? Is this the best time for buyers to enter the market? With all 10 of Zillow’s top housing markets for 2024 located east of the Mississippi, young people in particular may find promising opportunities in cities like Buffalo and Cincinnati. Zillow Report

🏠 Home Prices and Economy: Corelogic reports a 7.7% rise in home prices for 2023, with the full details expected later this quarter. The economy has defied recession predictions, with GDP growth outpacing expectations. But this strong economic performance means the Fed might not rush to drop rates, which have edged back up towards 7%. CoreLogic

🏗️ New Home Sales and Building Trends: December saw an 8% MoM increase in new home sales, and a shift towards building smaller, more affordable homes. But don't let the 14% drop in median new home sales prices fool you; it reflects the market's adaptation to demand for affordability. Census Bureau

📈 Market Projections and Personal Perspective: While some analysts predict a recovery in sales and a bullish run for new home sales, my view is more cautious. We might be at the peak of the market cycle, with economic uncertainties and high prices influencing buyer behavior. Remember, market cycles in real estate don’t swing as quickly as in stocks, but the pandemic did throw a wrench in the usual patterns.

🤔 Important Considerations for Buyers and Sellers: Whether you're considering selling your home or buying, it's crucial to assess your long-term plans and economic stability. For those contemplating investment properties, understanding the potential rent market fluctuations is key.

🌟 Special Offer: To add a cherry on top, if you refer friends or family to me and they close on a property, you’ll receive $1,500 cash as a token of my gratitude. Let's make 2024 a year of smart decisions and successful ventures in real estate!

Wishing you all a prosperous year ahead. Here's to finding that perfect home or making a wise investment in 2024! 🏠✨