Hope is on the horizon for house hunters looking to put down roots. With mortgage rates down from the 8% level they hit last fall, some real estate agents say 2024 could be a better year for homebuyers.
After all, the past two years have been the worst time in recent memory for buying a home. Sky-high mortgage rates, combined with record home prices, were freezing many buyers out of the market.
Casey Crowley is one of those people. We found her looking over a just-rehabbed home that might be perfect for her needs. She has been frustrated for the past year by elevated mortgage rates and low home inventory.
"It has been very frustrating," she said. "I really couldn't find anything that I was willing to pay more than what they were asking."
There is some good news, however, in 2024. Interest rates have dropped a point since they touched 8% last fall.
More Americans are optimistic about buying a home in 2024
For the average American, buying a home has felt impossible during the past couple of years, but potential buyers are feeling hopeful in 2024.
Fewer bidding wars right now
Crowley's real estate agents, Denise and Steve Taylor of EXP Realty, say they are seeing fewer bidding wars as 2024 gets underway.
"We're not seeing the crazy $10,000 and $20,000 over asking price anymore, maybe $3,000 or $4,000 like that at most."
In addition, homes in many areas are taking longer to sell, something that was unheard of two years ago when many sold in hours.
While mortgage rates are hovering around 7% right now, some experts believe they could dip closer to 5.5% by the end of the year. That's good news, even if you’ve already closed on a home.
Mark Wakefield has been a loan officer for 34 years. He says even if you bought at a high rate, "We do have the hope that in the next 12 to 24 months, you'll have a chance to refinance."
He says this housing cycle has been particularly hard because high mortgage rates haven't been accompanied by lower home prices, unlike during previous decades.
"The problem is there are so few homes out there and the competition is so high," Wakefield said.
For house hunters and hopefuls, he says to keep saving and looking for a place that fits both your budget and needs.
"Hang in there and I think better times are ahead for the buyers," Wakefield said.
Good news and worrisome news
His only concern is that if rates fall too fast, that would mean a new rush of buyers and higher home prices again. But the good thing about lower rates this year is that it means buyers like Crowley can afford a larger house.
"I will be ecstatic if it continues to drop, but I am going to take advantage of this decrease now," she said.
Steve and Denise Taylor say if you spent last year on the sidelines, now is the time to jump back in.
"Get out there now; there is never a reason to wait," they said.
