Is the Fall 2024 market looking up?

Oct 4

As the summer heat fades and the crisp autumn air sets in, the housing market undergoes notable changes. Understanding these seasonal trends can help buyers and sellers make informed decisions. This article delves into the current market conditions, historical fall trends, expert predictions, and practical tips for navigating the fall housing market.

Where housing stands as fall starts

The housing market has seen significant shifts in 2024. Rising interest rates, inflation, and economic uncertainties have influenced market dynamics. But at the end of the summer, some of those underpinning elements started to shift. The most notable was movement of national average mortgage rates.

As of this writing, the national average interest rate for a 30-year fixed mortgage hovers around 6.250%.* Just a few months earlier, rates were nearly a full percentage point higher, impacting affordability for many buyers. Despite that challenge, demand remained high, and competition for desirable properties was strong.

Recent data indicates a stabilization of home prices and a slight increase in inventory, providing more options for buyers. National Association of Realtors Chief Economist Lawrence Yun pointed out that “Even as the median home price reached a new record high (this summer), further large accelerations are unlikely. Supply and demand dynamics are nearing a balanced market condition.”

Predictions for this Fall

Here are a few key trends that you should be paying attention in the fall housing market for 2024:

Mortgage rates: The Federal Reserve appears ready to cut rates, which could lead to a decrease in mortgage rates. This potential drop in borrowing costs might entice more buyers into the market.
The number of home listings in your area: While housing inventory has increased, this trend may not last if more buyers enter the market due to lower mortgage rates. Therefore, current buyers might have more options now than later in the season.
Persistently high home prices: Despite some stabilization, home prices remain high. This trend is likely to continue, making affordability a challenge for many buyers. But it also underscores that owning a home is historically a good financial investment.
Great time for a refi: For current homeowners, Fall 2024 is shaping up to be a wonderful time to refinance your mortgage. Particularly owners who got a loan in the last few years, rates may dip below your current mortgage rate this fall. More on refis below.

Seasonal trends may change in 2024

Historically, the fall housing market slows compared to the busy spring and summer months. Families settle into the new school year, and the holiday season approaches, leading to fewer listings and less competition. This creates unique opportunities for motivated buyers and sellers.

Buyers often find less crowded markets in the fall, allowing for more negotiating power and potential deals. Sellers motivated to close before the end of the year may also be more willing to negotiate, creating a favorable environment for buyers.

However, this year has shown a shift in buying and listing behaviors. At the beginning of the year, many market watchers were expecting mortgage rates to come down in the first six months. This caused many buyers to wait, and sellers chose to wait to list their homes for sale as well. This pushed home prices higher.

This wait-and-see approach turned the normally active spring and summer homebuying seasons into relative sleepers. It’s possible that if mortgage rates come down, the fall will turn into an active market and competition could go up. This means that you should prepare to move fast once you find a home you love.

Refinancing takes center stage

As mortgage rates seem poised to come down, homeowners have a unique opportunity to refinance their existing mortgages. Refinancing can help you secure a lower interest rate, reduce monthly payments, or even tap into your home's equity through a cash-out refinance.

Lower Monthly Payments

Refinancing to a lower interest rate can significantly reduce your monthly mortgage payments. This can free up cash for other expenses or allow you to save more each month.

Shorten Your Loan Term

With lower rates, you might consider refinancing to a shorter loan term. For example, switching from a 30-year mortgage to a 15-year mortgage could save you money on interest over the life of the loan and help you build equity faster.

Cash-Out Refinance

A cash-out refinance* allows you to take advantage of the equity you've built up in your home. By refinancing for more than you owe on your existing mortgage, you can receive the difference in cash. This can be useful for home improvements, paying off high-interest debt, or other financial needs.

Cost-Benefit analysis of a refi

Refinancing can be a smart financial move in a falling rate environment like we’re expecting this Fall. However, it’s essential to weigh the benefits against the costs and consider your long-term financial plans. Here’s a few things you should take into consideration:

Closing Costs: Be aware of the closing costs associated with refinancing, which can include application fees, appraisal fees, and legal fees.
Break-Even Point: Calculate how long it will take to recoup the costs of refinancing with your monthly savings.
Loan Terms: Ensure that the new loan terms align with your financial goals.

Work with a mortgage professional who can help you navigate the process and determine the best option to reach your financial goals.

Tips for homebuyers this fall

Navigating the fall housing market requires a strategic approach. Here are some tips to help you succeed:

Get pre-approved for a mortgage: Before you start house hunting, get pre-approved for a mortgage. This will give you a clear understanding of your budget and make you a more attractive buyer to sellers. PowerBid Approval is a fully-underwritten credit approval that can compete with cash offers.
Be Ready to Move Quickly: While the market may be less competitive than in the spring, desirable homes can still sell fast. Be prepared to make quick decisions and have your paperwork in order.
Consider Off-Peak Listings: Homes listed in the fall may not have as much competition. Look for properties that have been on the market for a while, as sellers may be more willing to negotiate.
Work with a Knowledgeable Agent: A real estate agent with experience in the local market can provide valuable insights and help you find the best deals.
Prepare for a busy season
The Fall housing market offers unique opportunities for both buyers and homeowners. Whether you’re looking to buy a new home or sell your current one, this season could be the most advantageous time in years to achieve your real estate goals. Get ready for what could be a busy fall by talking with local real estate and mortgage professionals for personalized advice and guidance.