National Association of Realtors presents 2024 forecast

By |  December 13, 2023
Much of the strength in the market can be attributed to improvements in single-family residential spending, up more than 20 percent over the last three years. Photo: iStock.com/halbergman

The National Association of Realtors forecasts 1.48 million housing starts will get underway in 2024. Photo: iStock.com/halbergman

The National Association of Realtors (NAR) offered a forecast of the 2024 residential housing market, predicting that 4.71 million existing homes will be sold and that 1.48 million housing starts will get underway.

According to NAR, 1.04 million of those housing starts will be of the single-family variety while 440,000 will be multifamily starts.

NAR chief economist Lawrence Yun unveiled these findings and more during the association’s fifth annual year-end Real Estate Forecast Summit.

Other projections Yun shared are that the housing market should grow in 2024 and Austin, Texas, is the top real estate market to watch next year and beyond. Additionally, Yun predicts home sales will begin to rise next year – by 13.5 percent compared to 2023 – and that the median home price will reach $389,500.

“Metro markets in southern states will likely outperform others due to faster job increases, while markets in the Midwest will experience gains from being in the most affordable region,” Yun says.

Yun expects rent prices to further calm in 2024. He expects this trend to hold down the consumer price index.

Yun also predicts foreclosure rates will stay at historically low levels in 2024, comprising less than 1 percent of all mortgages.

Other findings

Additionally, Yun forecasts that U.S. GDP will grow by 1.5 percent in 2024, with the U.S. avoiding a recession and that net new job additions will slow to 1.7 million. That last mark compares to 2.7 million net new jobs in 2023 and 4.8 million in 2022.

Also, after eclipsing 8 percent in late 2023, Yun expects the 30-year fixed mortgage rate to average 6.3 percent in 2024 and that the Fed will cut rates four times – calming inflationary conditions – in response to slower economic activity.

Beyond Austin, NAR identified several other real estate markets as most pent-up for housing demand. These are Dallas-Fort Worth (No. 2), Dayton-Kettering, Ohio (No. 3), Durham-Chapel Hill, North Carolina (No. 4), Harrisburg-Carlisle, Pennsylvania (No. 5), Houston-The Woodlands-Sugar Land, Texas (No. 6), Nashville-Davidson-Murfreesboro-Franklin, Tennessee (No. 7), Philadelphia-Camden-Wilmington, Pennsylvania-New Jersey-Delaware-Maryland (No. 8), Portland-South Portland, Maine (No. 9) and Washington-Arlington-Alexandria, D.C.-Virginia-Maryland-West Virginia (No. 10).

“The demand for housing will recover from falling mortgage rates and rising income,” Yun says. “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.”

Related: FMI discusses aggregate industry dynamics, construction market

Kevin Yanik

About the Author:

Kevin Yanik is editor-in-chief of Pit & Quarry. He can be reached at 216-706-3724 or kyanik@northcoastmedia.net.

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