Happy New Year! With the ringing in of 2024, the real estate market looks bright given the recent drop in mortgage rates. In the last 2 months of 2023, the average, weekly, 30-year mortgage interest rate dropped from 7.79% to 6.61%. The economy also saw a year end rally - the S&P Index was up 25% and the Nasdaq up 45% in 2023.
It is no secret that the 2023 housing market was characterized by high interest rates, stock market uncertainty, and extremely low inventory. Purchase activity was down due to high interest rates, and sellers who had locked in their mortgage rate in the 3-4% range a few years ago were not selling, leading to an inadequate supply of homes on the market and limited options for potential buyers to choose from.
Overall, the number of new listings coming on the market in 2023 was the lowest in decades, due to sellers not wanting to forfeit their 3-4% interest rate they secured years prior.
We look forward to an exciting year in Boston Real Estate!
In 2023, the Fed was acting to counter inflation by increasing the target rate, which they did 11 times. Now that the rate has been unchanged since August, there is a consensus that the Fed will soon begin to drop its benchmark rate, and once determined what that benchmark rate will be, the Fed will act quickly to enact it.
Click here for the Extended Flip Book version of Compass’ National Real Estate Insights for 2024
