What's Up With Real Estate?

Fed Promises Rate Cuts for 2024, Is Soft Landing Here?

The Fed kept rates unchanged at their December meeting and is forecasting three rate cuts. This got everyone excited and mortgage rates went down under 7% for the first time in many months, at the moment, they are in the mid six range. It's all teeing up pretty nicely for the so called "soft landing" scenario where we don't go into a full fledged recession. 
Inflation has slowed to a 3.1% annual rate as the consumer price index only increased .1% in November, helped by the decrease in energy prices. Another positive for the inflation front, wholesale prices decreased .1% in December. Year over year, S&P Corelogic Case Shiller Index showed that home prices increased 4.7% over a year ago. Corelogic is forecasting a 2.5% increase nationally for 2024.

What does 2024 have in store?

It's all in the details......locally inventories are expected to rise, as compared to last year, but prices are forecasted at same to a little higher. Mortgage rates are expected to stay steady. One potential headwind will be insurance availability and increasing premiums. It's not been uncommon to have buyers scrambling to find insurance for their new home before close of escrow.

Check out the market stats below..... the three month rolling period is showing increases for almost all areas. While rates are higher and inventory is slightly higher, it's still not enough to offset buyer demand. What will make a difference this year is that listing inventory is expected to increase in most areas.

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