From Money Magazine:

Recent dips in mortgage rates have given Americans hope for the housing market in 2024. Fannie Mae’s national housing survey shows an increase in sentiment due to optimism about mortgage rates. 31% of respondents foresee lower mortgage rates in the next year, the highest number of hopeful outlooks. However, consumer attitudes are still largely pessimistic about home buying conditions.

The drop in mortgage rates is promising more listings and improved home sales ahead. The prospect of better home affordability could provide some relief for first-time buyers. Home prices are expected to remain high this year, which would hinder any improvements in affordability brought by falling mortgage rates.

Consumers’ negativity about home buying conditions aligns with housing experts’ expectations of continued low supply and high prices. Although Fannie Mae anticipates a slight reduction in housing costs in 2024, the ideal of affordable housing remains hard to attain. The real estate looks optimistic for 2024, but affordability will continue to be a major obstacle for buyers.

Fannie Mae expects improved home sales this year as more people are encouraged to list their homes amid decreasing mortgage rates. Although consumer attitudes suggest homebuying conditions will remain challenging, the optimistic rate outlook may signal an expectation that home affordability pressures will ease in 2024. On the other hand, experts expect supply to remain low and home prices to stay high, posing a barrier to first-time homebuyers.



Read more: Dip in Mortgage Rates Spurs (Some) Housing Market Optimism