Thinking of buying or selling a home? Here's what Realtors say to expect in 2024
Homebuyers and sellers should not wait until spring to be on the lookout for homes with inventory low and buyers and sellers out there ready or waiting to make a change, real estate professionals on the SouthCoast say.
Donna Davids, the incoming regional vice president for the Southeastern Region of the Massachusetts Association of Realtors (MAR), looking ahead to 2024, said it feels like that’s what they’ve been doing as far as trying to forecast the real estate markets recently.
She said inventory is expected to remain low in southeastern Massachusetts, particularly along the SouthCoast, and said MAR’s chief economist Lawrence Yun believes that mortgage rates could drop to 6 percent or slightly higher, which is down from the current average 8 percent.
“That will probably bring more potential buyers to the market, but hopefully it also spurs some sellers on the fence to list as it will cost less for them to purchase their next home, of course based on mortgage rates,” she said. “We will most likely see an increase in the average median sale prices again in 2024.”
Davids said she is seeing a lot of first-time homebuyers looking based on the interest rate. She said many homeowners now have a 3 or 4 percent rate, so when they’re looking to sell their home and go into a higher interest rate, they ask themselves if they really want to sell.
What is available for first-time homebuyers?
She said there are new first-time homebuyer downpayment programs being offered by financial institutions, and some Gateway cities will play a stronger role in assisting these buyers get into their first home as it will definitely continue to be unaffordable for many.
She said homeowners are waiting that out, so it’s really the first-time homebuyers who pay high monthly rates who are willing to pay a mortgage while building equity. The first time is always the most expensive and after that it gets less expensive even buying at a higher price, she said.
How is the future of commuter rail impacting the SouthCoast real estate market?
Davids said she has buyers who are looking more at the SouthCoast with the commuter rail extending to New Bedford than they would in the past without accessibility into the city, especially the multi-family buyers.
“I see a lot of people using that same frame of thinking and now getting more along the SouthCoast because now they will have access to move around and to work in the city (Boston) while living further south,” she said.
She said while about half the people are thinking they will wait to buy until the interest rates come down, the other half are ready to move forward with buying a home and plan on refinancing their home later.
That’s the advice she would give, she said, because interest rates always fluctuate.
What is the housing inventory like on the SouthCoast?
Maggie Tomkiewicz, the regional vice president of MAR’s Southeastern Region, said she sees a different segment of the market working more so on the southeast coastline and has experienced sellers who are ready to move on, whether they are downsizing or feel it’s a really good time to sell because they are getting record prices for housing here.
Tomkiewicz said the inventory is very low in her market area, but houses are selling, so even though it may look like the market has stalled, they come to market and are quickly under agreement, sometimes in days.
If they ’re on the market for 30 days, that’s a long time, but in a typical market, it could take three to six months before they are sold.
“The fact that they have so few choices now, if it’s something that checks off multiple boxes, they jump,” she said.
As for advice to buyers, she said if you find what you want, and can make it happen, do it, because as the interest rates come down, the number of buyers in the market will double, triple and even quadruple and that opens up opportunities.
Looking to 2024, Tomkiewicz said buyers and sellers ask if they should wait or go forward, and their advice to sellers is to get on the market before there is more competition, as soon as you can right after the first of the year, and for buyers it’s the same thing if a house checks off boxes or is in your budget.
“Don’t wait,” she said.
Davids and Tomkiewicz agree that major similarities between the market in 2023 and 2024 will be the low inventory and that there are always sellers and buyers for different reasons whether it’s a desire to move or those who are prepared to wait for lower interest rates.
Buyer and sellers in real estate
Colleen Barry, CEO of Gibson-Sotheby International Realty, said more so than in past years, there have been many shifts in the market. She said it has gone from a relatively normal seller’s market to a temporary pause in the market due to COVID to having a true overabundance of buyers, many of whom ae seeking a different lifestyle than the ones they were thrust into, or people looking to accelerate plans that they already had.
“It just drove a frenzy to market,” she said.
She said in mid-2022 when the rates went up and it appeared that home sales had come to a screeching halt, that wasn’t entirely the case. She said in some markets the number of transactions were below where they were prior to COVID, but some of them just slowed to where they were prior to COVID.
“Normalization after going that fast felt like a down market,” she said.
“There were some markets that did slow to a number of transactions that was well below where they were prior to COVID, but some of them just matched where they were prior to COVID, she said. “Everything just slowed down but from a pretty wild speed.”
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Will the real estate market rebound in 2024?
Barry said in 2024 the question becomes what happens to buyer and seller behavior. While not actual data, she said the end of the year is already showing tremendous signs that the market is coming back due to pending agreements and anecdotal scenarios.
“As I’m talking to experienced agents and getting a sense from all over the company about what’s happening, I’m seeing lots of signs that the market is emerging from this temporary slowdown,” she said.
She said they expect to see much more of a normal market; something that looks like it did just before COVID hit.
She said people who have put their moving plans on hold since the middle of last year because of the volatility in the mortgage industry, and people who are not living where they want to because they’re renting, living with their parents or for some other reason, are ready to buy.
“We’re starting to hear some of those folks say we’re not waiting anymore, let’s go out there, let’s figure out what we can afford, let’s put a plan in place,” she said.
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She said they are also seeing people who are commuting into the office again because their employers want them back for just for a few days or more a week, but a move to a new home too far away would be a hardship.
She said the factors they anticipate pushing in that direction include an anticipated cut in interest rates by the Federal Reserve going into 2024 and the inflation not seen in decades slowing that process down with the cost of goods everywhere proving to be hard on people.
“They knew they had to do something to slow that process down,” she said, with the hopes of making consumers less apprehensive while positively affecting real estate and mortgage interest rates.
She said both buyers and sellers who have been holding off putting their properties on the market while unsure of the mortgage rates or some other reason but are now ready to take the next step should lead to a positive real estate market in 2024.
Start looking this winter
On the SouthCoast, Barry and her team working out of the Dartmouth office has been pulling together listings they will roll out early in the new year, as soon as January, which wasn’t usually the case.
“We see that there are very serious buyers out there during winter, during these times when in the past we considered it to be a quiet time, but now we can look at the actual data and see the buyer activity is great, let’s put it on now,” she said.
She said the timing of putting a property on the market depends on the property and whether there’s any property like it out there. If there are similar properties on the market, she said it wouldn’t make sense to put that property on the market.
She said local market experts study buyer behavior and real data to help fill the need that’s out there and share the feet-in-the-street data so buyers and sellers can make the best possible decisions.
She said they look at statistics statewide, regionally, locally, by neighborhood and by street to see what kinds of properties are available so they don’t miss out on great opportunities because timing is so important.
That’s not to say anyone is going to go look at a house in the winter unless they have to move, whether for a possible relocation, change in school or other reasons.
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Greater Fall River real estate market
Holly Bronhard, a real estate professional based in Fall River, said 2023 was a good year for her due to her referral business. She said what she has been selling this whole year is homes due to divorces, the settling of estates and people who are leaving the state.
“No one is buying and selling just to move from Highland Avenue to Madison Street,” she said. “I do think that the interest rates are coming down, and they’re going to stay lower for 2024. The Feds just checked the rate and didn’t put it up to keep them a little bit steady.”
She said it’s part of the effort to try to maintain inflation rates.
She said she thinks that in 2024, there will be more of a race to the spring market if the interest rates come down for people who have been newly pre-approved, but it’s the people who bought two or three years ago and got a great rate are not the ones who are going to be moving.
“The people that are just getting pre-approved, they don’t know the difference because they’re new to the market so they don’t even have a comparison of what their mortgage would look like at 4 percent and now it’s at 7 percent,” she said. “I doubt it’s ever going to go below 6 percent.”
“If you just keep waiting and waiting and waiting for that to go back down to 4 percent, you’re going to miss out on a lot of transactions,” she said.
She said the mortgage companies having been working with people offering a variable rate for about five years so that they can keep it low and refinance years from now, adding that she doesn’t foresee there being any kind of a crash.
If people wait, it’s just going to get worse because there still won’t be a ton of inventory because people with a low rate are hanging onto it because they don’t have any equity in it unless they bought it two years ago.
She doesn’t see the prices of the housing coming down any either because she is receiving multiple offers on houses she has listed including a three-family in Fall River with offers $10,000, $20,000 and even $40,000 over the listing price.
“The houses are still selling, and as long as they are still selling, the prices will remain high because they are appraising it at that price,” she said.
Don't settle for less when considering a new home
She said prices are at a premium, but most people are not desparate. They are waiting and don’t want to settle for less, and don’t want a project, and the buyer pool increases.
She also is finding that extended families are willing to live together in the same house with the return of the multi-generational family in a duplex, raised ranch or separated by floors.
She said there are apartments in Fall River, but at a high cost of $2,600 a month for a two-bedroom apartment, some with or without water views.
Bronhard said the inventory is increasing, but it’s not necessarily what someone wants, but those who wait are going to get stuck. She said she would advise anyone against waiting and buy the house with a variable mortgage and refinance in five years. She said it’s the same all over.
She said a home will not stay on the market longer than two weeks if priced right, and houses are moving quickly unless they are overpriced. She said she already has listings ready for January and February and expects to be busy this spring.
Standard-Times staff writer Kathryn Gallerani can be reached at kgallerani@gannett.com. Follow her on Twitter: @kgallreporter. Support local journalism by purchasing a digital or print subscription to The Standard-Times today.
This article originally appeared on Standard-Times: Homebuyers and sellers may not want to wait with few options out there
