
Fluctuations over the past few years have left many wondering what the 2024 housing market will look like. With prospective homebuyers keeping a close eye on the market, we’re here to look at some key indicators for mortgage rates and home prices.
2024 Mortgage Rate Outlook
2023 was without a doubt another challenging year for mortgage shoppers. High rates from 2022 rolled over into 2023 and stayed elevated through the first part of the year. Through Spring and early Fall, rates continued to increase, reaching an average high of 7.79% in October - the highest averages the market has seen in decades. With mortgage shoppers wondering what’s next, we turn to the U.S. Federal Reserve for a little guidance.
The U.S. Federal Reserve & Mortgage Rates
While the U.S. Federal Reserve (the Fed) doesn’t directly oversee the rates for mortgages, the rates do correlate with actions taken during Federal Reserve meetings. If the Fed raises rates, mortgage rates are likely to also increase. During their last three meetings in 2023, the Fed left rates unchanged. This comes after raising the rates 11 of the 16 meetings through 2022 and 2023. Now, the Fed is envisioning rate cuts for the second half of 2024, meaning mortgage rates are also likely to fall.
But don’t start packing your boxes yet. With falling rates on the horizon and mortgages becoming more affordable, the housing market is also taking note.
2024 Home Prices Overview
Over the past few years, as demand continued to increase, the housing market became increasingly competitive. With limited supply and an increase in demand, home prices were driven higher. In November 2023, home prices were up an average of 5.2% YOY – a decrease in comparison to the 13.74% average increases seen in 2019 – 2022. With many would-be sellers locked into a lower mortgage rate and facing the increasing home prices, they were reluctant to make changes. Change may be on the horizon, however. A predicted lowering of mortgage rates, coupled with the cost of homes slowing may be “the perfect storm”. Along with seeing some movement in the housing market, there are some additional opportunities for current and prospective homeowners.
Refinancing Your Home in 2024
2024 may be an ideal time to refinance your home. Inevitably, the housing market never stops, even when conditions aren’t favorable. The past few years of high rates and high home prices have many recent buyers in a higher mortgage rate than they would like. With mortgage rates predicted to drop this year, it may be an ideal time to refinance your home. Refinancing may be a good option if you:
- Would like to reduce your monthly payments
- Want to adjust your loan term
- Would like to consolidate your mortgage debt
- Need extra cash for a major purchase
- Are planning to renovate your home
If you’re interested in refinancing your home, the experts at MidWestOne Bank are here to help answer any questions you have and get you on the right path. Contact our Refinancing Experts today!
First Time Homebuyers Outlook for 2024
First time homebuyers had a particularly difficult time with the competitive housing market and high mortgage rates. With rates and home prices cooling on both fronts, there’s a reprieve on the horizon for those looking to purchase their first home. First time home buyers can get helpful benefits such as downpayment assistance and closing cost credits from programs like First Home Now.
If you’re thinking 2024 is a good year for you to buy your first home, the MidWestOne Mortgage Team is here to help make your home ownership dreams a reality – Contact Them Today to stary your journey!
Closing the Deal for the 2024 Housing Market
Getting you the right mortgage for your needs is our goal. With the potential for rates to drop and the increase of home prices slowing, the outlook is positive for the 2024 housing market. Whether you’re looking to buy your first home, refinance your current home or anything in between, your mortgage experts at MidWestOne Bank are here to help!
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