California housing market will rebound in 2024 (2024)

FAQs

California housing market will rebound in 2024? ›

Existing, single-family home sales are forecast to total 327,100 units in 2024, an increase of 22.9 percent from 2023's projected pace of 266,200. California's median home price is forecast to climb 6.2 percent to $860,300 in 2024, following a projected 1.5 percent decrease to $810,000 in 2023 from 2022's $822,300.

Average Home Prices: The median home price in California is $855,100. But, it is expected to decrease due to a rise in inventory in the latter half of 2024. The sale-to-list price ratio is 101%, down by 0.29 pt YoY.

Yes. This is the best time to buy a house in California. With the current trend in the CA housing market, you'll find better deals on your dream home during Q2 2024. As per Fannie Mae, mortgage rates may drop more in Q2 of 2024 due to economic changes, inflation, and central bank policy adjustments.

As of Thursday, September 12, 2024, current interest rates in California are 6.58% for a 30-year fixed mortgage and 5.82% for a 15-year fixed mortgage.

If you're considering waiting until 2025 to buy a house, you may be wondering when will interest rates go down. Most economists anticipate that mortgage rates will decline somewhat in 2025, especially if the Federal Reserve cuts the federal funds rate again.

Experts overwhelmingly say that the housing market isn't going to crash anytime soon. The last housing crash helped cause today's lack of supply, which is what's keeping prices from falling. Mortgage rates, however, are expected to fall this year. This will help make homeownership more affordable.

' Housing affordability challenges are currently persisting amid supply shortages and high demand. Experts suggest there may be some moderation in price growth, but it is unlikely that we will see broad declines in the California real estate market.

And as you might imagine, recessions are a risky time to buy a home. If you lose your job, for example, a lender will be much less likely to approve your loan application. Even if a recession doesn't affect you directly, if your area is hard-hit, that could have a serious effect on the local real estate market.

Generally, if you intend to stay in a property for more than 2-5 years, it becomes more worth it to buy a house in California. Over this time, you will build equity and benefit from property appreciation.

Late summer and early fall may give you the best of both worlds with a combination of good selection with less competition and slightly lower prices.

Will mortgage rates go down again in 2024? ›

“The anticipation of an upcoming rate cut is already influencing the market, leading to downward pressure on mortgage rates,” it wrote in an official August 2024 outlook report. “As a result, we forecast mortgage rates to gradually decline in the coming quarters.”

Mortgage rate predictions

As you can see, both predict rates will drop over the coming year or two, but very gradually. Experts also don't expect any drastic dips in rates — say to 3% or 4%, as experienced during the height of the COVID-19 pandemic.

Leading forecasts suggest that by 2026, the average mortgage rate could drop to around 5.0% according to various sources, including the predictions shared by financial analysts on platforms such as Morningstar. They suggest a gradual decline will continue, culminating in rates around 4.5% to 4.25% by 2027.

In a recent note, Chief US Economist Michael Gapen and his team revealed that they expect home prices to rise by 4.5% this year and 5% in 2025. Gapen doesn't foresee the market cooling down until 2026 at the earliest. With this in mind, current homeowners can sell for even higher prices down the road.

Predictions for 2024

foresees a comeback, with dwindling mortgage rates and more houses hitting the market. They predict a surge in home sales by 22.9% and a 6.2% rise in the median home price for 2024. Economic strength, subdued inflation, and uplifted consumer spirits could further buoy the market.

Bank of America expects home prices will climb by 4.5% this year and then by another 5% in 2025 before eventually dipping by 0.5% in 2026.

Summary. California's average cost of living is $53,082 annually. Californians spend more than any other state on groceries per month, at $298. California is also above the national average when it comes to the cost of utilities, with the average monthly bill coming in at nearly $438.

Average rent affordable for different income type households in California, U.S. 2024. The average monthly rent in California for a two-bedroom apartment was 2,464 U.S. dollars in 2024, while a one-bedroom unit cost 1,989 U.S. dollars.

Forecasting future home prices is an exercise in educated guesswork. The California Association of Realtors (C.A.R.) predicts a modest increase of 6.2% in the median home price for 2024, reaching $860,300. However, long-term forecasts for the next five years are more nuanced.

Best Time to Sell Your House for a Higher Price

April, June, and July are the best months to sell your house in California. The median sale price of houses in June 2023, was $796,400, which is expected to grow more in 2024. However, cities like Arcadia and San Mateo follow an upward trend throughout the year.