Thinking About Buying a Home? Ask Yourself These Questions

If you want to buy a house this year, you’re likely keeping a close eye on the housing market. You’re gathering information from different places like the news, social media, your real estate agent, and discussions with friends and family. You’ve probably heard a lot about home prices and mortgage rates.

As you decide, consider these two important questions and the data that can help you make sense of it all.

1. Where Do I Think Home Prices Are Heading?

A trustworthy source for predictions about home prices is the Home Price Expectations Survey by Fannie Mae. This survey includes insights from more than one hundred economists, real estate experts, and market strategists. Based on the latest findings, these experts predict that home prices will likely keep going up, at least until 2028, as shown in the graph below.

So, why should you care about this? Even though the rate of home value increase might not be as high as it was in recent times, the crucial point is that according to this survey, home prices are expected to go up, not down, for at least the next 5 years.

This is good news for you. Even with a more moderate increase, it suggests that if you buy a home now, its value is likely to grow, and you should build equity in the coming years. However, if you postpone your purchase, following these predictions, the home will likely become more expensive later on.

In the last year, mortgage rates increased due to economic uncertainty and inflation concerns. However, there’s positive news for both the housing market and mortgage rates. The inflation rate is slowing down, and this is significant if you’re considering buying a home.

When inflation decreases, mortgage rates usually follow suit and go down. This is precisely what has been happening in the past few weeks. Moreover, with the Federal Reserve indicating a pause in Federal Funds Rate increases and the possibility of rate cuts in 2024, experts are increasingly optimistic that mortgage rates will continue to decrease.

According to Danielle Hale, Chief Economist at Realtor.com, mortgage rates are expected to decrease in 2024 as inflation improves and the possibility of Federal Reserve rate cuts approaches. This is considered a crucial factor in making homes more affordable for potential buyers.

An article from the National Association of Realtors (NAR) suggests that mortgage rates have likely reached their highest point and are now on a downward trend from nearly 8%. This positive shift is anticipated to enhance housing affordability and attract more homebuyers to the market.

While no one can predict mortgage rates with absolute certainty, the recent decline and the Federal Reserve’s decision to halt rate increases offer a hopeful outlook. Despite potential fluctuations, the expectation is that affordability will improve as rates continue to decrease.

Bottom Line

If you’re considering buying a home, it’s essential to be aware of the anticipated trends in home prices and mortgage rates. Although no one can predict their exact trajectory, staying informed with the latest information can empower you to make well-informed decisions. Let’s connect, so you can stay updated on current developments and understand why this is positive news for you.

Find out why Kaya Homes is the leader in Long Island Real Estate and are your go-to realtor in the Lynbrook, Oceanside, Malverne, Hewlett, Valley Stream, East Rockaway, Woodmere, Cedarhurst, Baldwin, North Woodmere, Woodsburgh, Hewlett Neck Hewlett Harbor, Bellmore,Wantagh,Merrick and Freeport area.