Autumn Market Begins with Lowest Interest Rates Since Spring 2023
The August market was basically in a holding pattern, following typical seasonal trends, as the summer holidays drew to a close amid declining interest rates, indications of impending cuts in the Fed’s benchmark rate, improving housing affordability, substantial financial market volatility, and a huge helping of presidential election news. The autumn selling season, just begun, typically sees significant market activity before the big mid-winter slowdown begins in late November, and some expect a very substantial rebound in demand due to interest rate declines.
“The time has come for policy to adjust…the timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks…My confidence has grown that inflation is on a sustainable path back to 2 percent.”
Jerome Powell, Chairman, Federal Reserve Bank, 8/23/24
“We forecast mortgage rates to gradually decline in the coming quarters and anticipate a significant surge in homebuying demand, mainly from the first-time homebuyers left at the margins. However, the tight inventory is still expected to limit home sales. We expect home sales to increase modestly the remainder of the year and home prices to rise 2.1% in 2024.”
Freddie Mac Research (FHLMC), 8/22/24
“Consumers’ short- and long-run economic outlook improved [in August], with both figures reaching their most favorable levels since April 2024 and a particularly sizable 10% improvement for long-run expectations that was seen across age and income groups.”
University of Michigan, Survey of Consumers, 8/30/24
“Latest macroeconomic data suggests that the economy remains solid, with the cooling trend in inflation continuing at the start of Q3 2024. Both consumers and business leaders feel upbeat in general and have a positive outlook about the near future. With the Fed expected to adjust rates downward in their next few meetings, the housing market should pick up some momentum throughout the rest of the year. There are challenges…The ongoing insurance crisis, for example…has presented difficulties for homebuying and could remain a major headache for the market [over] the next couple of years.”
California Association of Realtors, 9/6/24
“Presidential elections have little impact on home sales…[ultimately] home purchases are usually life decisions rather than political ones.”
John Burns Research & Consulting, 7/30/24
This report includes a deep dive into regional city & town values and characteristics along with a comprehensive review of general market indicators.
Report created in good faith with data from sources deemed reliable but may contain errors and subject to revision. Statistics are affected by a variety of factors and are best considered indicators of change rather than exact measurements. All numbers approximate and may change with late-reported activity.
Statistics are generalities, essentially summaries of widely disparate data generated by dozens, hundreds or thousands of unique, individual sales occurring within different time periods. They are best seen not as precise measurements, but as broad, comparative indicators, with reasonable margins of error. Anomalous fluctuations in statistics are not uncommon, especially in smaller, expensive market segments. Last period data should be considered estimates that may change with late-reported data. Different analytics programs sometimes define statistics – such as “active listings,” “days on market,” and “months supply of inventory” – differently: what is most meaningful are not specific calculations but the trends they illustrate. Most listing and sales data derives from the local or regional multi-listing service (MLS) of the area specified in the analysis, but not all listings or sales are reported to MLS and these won’t be reflected in the data. “Homes” signifies real-property, single-household housing units: houses, condos, co-ops, townhouses, duets and TICs (but not mobile homes), as applicable to each market. City/town names refer specifically to the named cities and towns, unless otherwise delineated. Multi-county metro areas will be specified as such. Data from sources deemed reliable, but may contain errors and subject to revision. All numbers to be considered approximate.
Many aspects of value cannot be adequately reflected in median and average statistics: curb appeal, age, condition, amenities, views, lot size, quality of outdoor space, “bonus” rooms, additional parking, quality of location within the neighborhood, and so on. How any of these statistics apply to any particular home is unknown without a specific comparative market analysis.
Median Sales Price is that price at which half the properties sold for more and half for less. It may be affected by seasonality, “unusual” events, or changes in inventory and buying trends, as well as by changes in fair market value. The median sales price for an area will often conceal an enormous variety of sales prices in the underlying individual sales.
Dollar per Square Foot is based upon the home’s interior living space and does not include garages, unfinished attics and basements, rooms built without permit, patios, decks or yards (though all those can add value to a home). These figures are usually derived from appraisals or tax records, but are sometimes unreliable (especially for older homes) or unreported altogether. The calculation can only be made on those home sales that reported square footage.
Photo use under the Creative Commons License: https://creativecommons.org/licenses/by-sa/2.0/
Compass is a real estate broker licensed by the State of California, DRE 01527235. Equal Housing Opportunity. This report has been prepared solely for information purposes. The information herein is based on or derived from information generally available to the public and/or from sources believed to be reliable. No representation or warranty can be given with respect to the accuracy or completeness of the information. Compass disclaims any and all liability relating to this report, including without limitation any express or implied representations or warranties for statements contained in, and omissions from, the report. Nothing contained herein is intended to be or should be read as any regulatory, legal, tax, accounting or other advice and Compass does not provide such advice. All opinions are subject to change without notice. Compass makes no representation regarding the accuracy of any statements regarding any references to the laws, statutes or regulations of any state are those of the author(s). Past performance is no guarantee of future results.
