April 2024 Monthly Market Reports
Will Inventory Improve for the Spring Housing Market?
The inventory of homes actively for sale increased in 45 out of 50 of the largest metros compared with last year, and in our large metros, inventory was above pre-pandemic levels.
For the first three months of this year, the inventory of homes actively for sale was at its highest level since 2020. However, while inventory this March is much improved compared with the previous three years, it is still down 37.9% compared with typical 2017 to 2019 levels.
In March, as in the previous month, the growth in homes particularly priced in the $200,000 to $350,000 range outpaced all other price categories, as home inventory in this range grew by 30.5% compared with last year.
What's Next for Rate and Affordability?
The Federal Reserve influences mortgage rates but doesn't set them. At its March 20, 2024, meeting, the central bank kept the federal funds rate unchanged and said it will keep an eye on economic developments to decide what its next rate move will be.
Mortgage rates are influenced by many elements, including the inflation rate, the pace of job creation, and whether the economy is growing or shrinking. The Federal Reserve's monetary policy is a factor, too, and is set by the Federal Open Market Committee.
Housing demand has been on a steady rise due to population and job growth, though the actual timing of purchases will be determined by prevailing mortgage rates and wider inventory choices.
When you zoom out, affordability is still very, very low from a historical perspective.
Is It Really Better To Rent Right Now?
Among the top considerations are the financial costs and benefits of renting versus owning, and one approach is to compare the monthly costs of renting a home against buying a home. With such cost comparisons, we can identify whether a market favors renting or buying. This is particularly important given today’s landscape marked by elevated mortgage rates and still-high home prices posing substantial challenges for would-be homeowners.
