As we step into 2024, the real estate scene in Westchester County, New York, and the nation as a whole, is buzzing with excitement. Against the backdrop of evolving market dynamics and a dip in interest rates, the coming year is looking hopeful for both buyers and sellers. As we set our real estate goals for the year ahead, our team has been analyzing the data and predictions from industry experts, including Brian Buffini, who for nearly three decades has been a respected expert and guiding force in real estate. Here is a summary of his outlook for 2024.
The Shock of Increases in Mortgage Interest Rates Will Fade Out
In his recent biannual market update, Buffini emphasizes that the era of extremely low mortgage rates, an anomaly driven by the pandemic-induced recession, has come to a close.
Currently, about 90% of homeowners have rates below 6%, with only a quarter of homeowners enjoying rates below 3%. In 2023, mortgage buy-downs helped many buyers purchase homes regardless of rate hikes.
The Prediction: Buffini predicts a shift, with the Federal Reserve halting rate hikes as inflation trends downward. Foreseeing formal cuts around July, he anticipates finishing 2024 with rates below 6%. This will bring an insurgence of activity mid-year. Rates are expected to drop in the third and fourth quarters, leading to a strong finish with approximately 4.6 million sales – a 20% increase from 2023. The positive momentum is projected to extend into 2025, marking a decade-high spring selling season and a robust 15% growth for the year.
Pent-Up Buyer Demand Creates a Favorable Environment for Sellers in 2024
One significant driving force in the market is the pent-up demand from potential buyers, including the 72 million millennials in the United States.
With the average age of first-time homebuyers at 35, approximately 45.5 million individuals are poised to enter the market as rates become more favorable in 2024. Buffini notes that rising rents, a major contributor to inflation, have stabilized but remain high, intensifying the desire to transition from renting to homeownership.
The Prediction: With anticipated rate cuts and a surge in sales, the market may soon witness a flurry of activity, driven by millennials and others eager to make a move, with family proximity ranking as the top motivator.
The impact of rising rents adds another layer to the narrative, making the prospect of homeownership even more appealing.
“There will be an extraordinarily strong finish to next year,” Buffini said. “I’m projecting around 4.6 million sales, about a 20% increase next year. I also believe that it’s going to boomerang and continue to horseshoe around into 2025. I think we’re going to have the biggest selling season in the spring of 2025 we’ve had in 10 years and we’re going to have a very, very solid 2025 with about another 15% growth.”
As the year unfolds, Buffini's predictions serve as a beacon, guiding both buyers and sellers through the exciting opportunities that lie ahead.
For more information on buying and selling in the Northern Suburbs of New York City, get connected with our team!
