Spring 2024 Housing Market Predictions

The CrossCountry Mortgage team recently sat down with Chris Bennett, Principal of mortgage hedge advisory firm Vice Capital Markets, to discuss the current state of the housing market and what homebuyers can expect throughout 2024.

Mortgage originations are now on the upswing for spring 2024

As warmer weather approaches, the housing market is expected to see an increase in home purchase activity. Many buyers have been waiting on the sidelines, hoping for a significant drop in mortgage rates before making a move. However, those waiting for dramatic rate decreases may want to reconsider their strategy.

Housing inventory remains limited across much of the country. As mortgage rates gradually decline, increased buyer demand could place upward pressure on home prices, making affordability more challenging for those who continue to delay their home search.

Don’t expect rates to immediately drop. 

While mortgage rates have shown signs of improvement, experts caution against expecting immediate or dramatic declines.

The mortgage industry closely monitors economic indicators, Federal Reserve policy decisions, inflation trends, and employment data to help forecast future rate movements. Although conditions are moving in a positive direction, the path toward lower rates is expected to be gradual.

According to Bennett, today's market shares similarities with conditions seen during the 1990s. Rather than implementing aggressive policy changes, the Federal Reserve is likely to make smaller adjustments as it transitions from a highly restrictive stance toward a more neutral long-term position.

This shift could eventually help mortgage rates move closer to historical averages, which have typically hovered around 5%.

We’re slowly moving to a more normal market, which will create more housing opportunities. 

As rates ease over time:

• More homeowners may choose to sell, increasing housing inventory.
• Buyers could benefit from a wider selection of homes.
• Existing homeowners may have opportunities to refinance and lower their monthly payments.
• Increased market activity may create more opportunities for buyers who have been waiting to enter the market.

While no one can predict rates with certainty, the overall trend suggests the market is slowly moving toward greater balance and opportunity.

This article is for educational purposes only and does not constitute financial or mortgage advice. Loan programs, rates, and guidelines may change at any time. All loans are subject to credit approval and underwriting. For guidance tailored to your situation, consult a licensed mortgage professional.