“2024: A Pivotal Year for the US Housing Market’s Renaissance” encapsulates the National Association of Home Builders (NAHB) CEO, Jim Tobin’s assertion that a substantial drop in mortgage rates is defining a transformative year for the US housing market. The average rate for a 30-year loan, witnessing its most significant decline since May of the previous year, fell to 6.60% from a peak of nearly 8% in October
Tobin anticipates a “housing renaissance” in 2024, characterizing it as a pivotal year where the market moves beyond the post-COVID slowdown. The recent drop in rates is luring potential buyers who were sidelined by inventory shortages and higher mortgage rates. Analysts anticipate a resurgence in housing sales, which reached a 30-year low last year.
Key indicators support the optimism, including a 10% increase in mortgage applications, a 1.9% rise in authorized residential permits, and a 7-point gain in the National Association of Home Builders/Wells Fargo Housing Market Index. Builders are responding to heightened demand by offering incentives like mortgage rate buydowns.
Despite December’s dip in home sales, Lawrence Yun, the chief economist of the National Association of Realtors, anticipates an uptick in the coming months, citing a 5% increase in lockbox activity. As the market gains momentum, Fannie Mae has revised its forecast, expecting the 30-year fixed mortgage rate to average 6.4% in the first quarter of 2024.
In conclusion, lower mortgage rates, increased buyer interest, and a favorable outlook for new construction are driving the US housing market toward a resurgence in 2024, as highlighted by the title ‘2024: A Pivotal Year for the US Housing Market’s Renaissance.’