As we embark on 2024, I predict a sustained period of interest rates above 7%, impacting borrowing costs and housing affordability. However, there's potential for a slight increase in housing inventory in Cincinnati, offering more options for buyers in a market that's been tight for years.
Dear clients and friends,
As we welcome the new year, I’m excited to share with you my annual real estate predictions for 2024. Now, remember, predictions are a tricky business, and I fully acknowledge there’s a chance I might not get it entirely right. In fact, we’ve already gotten one wrong! So, let’s dive in with a pinch of optimism and a dash of reality.
Prediction #1: Interest Rates Above 7% Firstly, I anticipate that interest rates will likely remain above 7%. The stubborn inflation rate, hovering around 3-3.1%, suggests that the last 1% decrease needed to reach the Federal Reserve’s target might take longer than expected. This scenario implies that we’re probably looking at a sustained period of higher mortgage interest rates throughout most of 2024.
What This Means for You If you’re planning to buy a home this year, it’s crucial to consider this in your financial planning. Higher interest rates affect borrowing costs and monthly payments. However, don’t let this dishearten you. Owning a home is a long-term investment, and the current market conditions shouldn’t deter you from pursuing your homeownership dreams.
Prediction #2: A Slight Increase in Inventory Secondly, there’s a light at the end of the tunnel for those who’ve been struggling with the limited housing inventory in Cincinnati. I predict a slight increase in available homes. This shift could be due to the reduced borrowing capacity resulting from the higher interest rates. However, a significant increase in inventory is unlikely until we see a drop in interest rates to around 5%.
Opportunities for Buyers For buyers, this could mean more options and less competition. It’s a good time to keep an eye on the market and be ready to make a move when the right opportunity presents itself.
Prediction #3: The U.S. Maintains Economic Dominance Lastly, I believe the U.S. will continue to be a dominant force in the global economy. This prediction is crucial for real estate investors. Homeownership is not just about having a place to live; it’s a cornerstone of wealth building. With the average homeowner’s net worth significantly higher than that of renters, investing in real estate remains a sound strategy for long-term wealth accumulation.
Why This Matters Investing in real estate is essentially a vote of confidence in the American economy. It’s a long-term strategy that pays off by building personal wealth over time.
In Conclusion So, there you have it – stable interest rates, a modest uptick in housing inventory, and the continued economic strength of the U.S. As we navigate the twists and turns of the real estate market in 2024, remember that I’m here to guide you every step of the way. Whether you’re buying, selling, or just curious about the market, don’t hesitate to reach out.
Let’s check back in twelve months and see how these predictions hold up. Until then, here’s to a prosperous and fulfilling year ahead in real estate!