The Fairfield County CT housing market has undergone notable transformations over the years, marked by unexpected appreciation. Throughout the pandemic, our charming and distinctive towns gained attention as people sought homes due to increased demand and a shortage of available properties. Many individuals, prompted by lifestyle changes, found the allure of suburban living in Connecticut particularly appealing.
In 2023, despite persistently limited inventory and elevated mortgage rates, the housing market remained resilient. The scarcity of options did not dampen the enthusiasm for home sales. Faced with few alternatives and a persistent demand to purchase, Fairfield County continued to witness sustained interest and robust sales activity.
As 2024 draws near, those looking to sell their homes and aspiring buyers are experiencing a blend of anticipation and apprehension regarding the future. Let’s explore the housing forecasts, in the coming year, examining the factors that could impact market dynamics and shape the real estate landscape.
Mortgage Rates: A Rollercoaster Ride
One of the key factors influencing the real estate market is mortgage rates. As of now, rates are quite a bit higher than the last few decades. Rates roughly doubled in 2022, largely attributed to the Federal Reserve’s concerted efforts to combat inflation. Despite the fact that the Federal Reserve doesn’t directly dictate mortgage rates, its actions have a consequential impact. Mortgage rates increased in response to the Federal Reserve’s series of rate hikes throughout the year. What is the mortgage rate prediction?
The prediction for 2024, however, is a potential shift in this trend of increasing rates. The Federal Reserve has announced they may be cutting rates in 2024 in response to an economic slowdown starting in the second quarter of 2024. This change could provide relief for buyers, making homeownership more accessible and potentially boosting the demand for homes in Easton.
Home Prices: A Balancing Act
In recent years, Fairfield County towns has experienced an upswing in home prices, establishing it as a seller’s market. However, we observed a stabilization of home prices in 2023, and the forecast for 2024 suggests a nominal increase. A common question on many minds is whether the market will witness a downturn in home prices. The straightforward answer is no. Experts anticipate a gradual stabilization or a more tempered rate of increase, leading to a more balanced market. This scenario presents opportunities for both buyers and sellers. Sellers stand to benefit from the equity accumulated in recent years, while buyers may encounter somewhat more favorable conditions.
Inventory Challenges: The Quest for Homes Continues
One of the persistent challenges in the housing market has been the limited inventory. The prediction for 2024 suggests that while there might be some improvement, inventory will remain tight. The high demand for homes may continue to pose challenges for buyers. For sellers, it continues to be an advantageous time to sell your home for an optimal price. Ultimately, the dynamics of supply and demand will continue to drive the housing market. If there is a decrease in mortgage rates, it could incentivize some homeowners to enter the market, potentially altering the levels of supply.
Key housing market stats
- The median single family home price saw a slight drop, in Dec 2023 $871,070, up +7.0% from 2022.
- The month supply of inventory was 2.2 months relatively unchanged from 2022. Keep in mind a balanced market is 5-6 months on inventory.
- Homes are selling at a 101% list to sale price ratio indicating the strength in the market.
- The days homes are on the market is 44 days compared to 36 days in 2022.
Key takeaways
- The limited inventory maintains the advantage for sellers in the housing market.
- Elevated mortgage rates and soaring home prices are affecting home affordability.
- A potential drop in rates in 2024 could stimulate activity in the market, benefiting both buyers and sellers.
As we look ahead to 2024, the Connecticut housing market presents a mix of opportunities and challenges. While the economy and mortgage rates remain key concerns, there is optimism for a more balanced market. To maximize opportunities in the dynamic real estate world, staying informed and adapting to evolving trends is crucial for both buyers and sellers in Easton. Whether you’re contemplating a short-term or long-term sale, it’s never too early to strategize. Preparation is the cornerstone of a successful transaction. Feel free to reach out, and let’s embark on this journey together!
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