In September 2020, amidst an unprecedented global pandemic and a highly contentious political climate, I shared my thoughts on how the presidential election might impact the real estate market. Fast forward to 2024, and we find ourselves in a familiar yet distinctly different scenario, with current President Joe Biden most likely facing off against former President Donald Trump once again. As we navigate another what will surely be a wild election season, let’s delve into the landscape of real estate and its implications for potential homebuyers and sellers.
Then vs. Now – The Presidential Candidates and Economic Context
In 2020, the world was stunned by the onset of COVID-19, causing seismic shifts across all sectors, including real estate. Contrary to many predictions, the market remained stable, propelled by record-low mortgage rates. Today, while COVID-19 remains present, it has become a part of most of our normalized lives. Now other global issues have taken precedence, shaping economic policies and market sentiments. The political stage is set with familiar faces, yet the stakes and dynamics have evolved.
The Real Estate Market in 2020
Four years ago, the market began what we call the “unicorn years” due to an all-time low in mortgage rates and a surge in home sales, defying the typical election-year uncertainty. This unexpected resilience was a testament to the underlying strength of the real estate sector and the adaptability of buyers and sellers alike.
The 2024 Real Estate Landscape
The current market paints a different picture, with mortgage rates reaching a two-decade high and the overall number of sales dwindling to 20-year lows. Homeowners who locked in low rates or paid off their mortgages have little incentive to sell, leading to constrained inventory. Despite these challenges, there’s a silver lining: mortgage rates are expected to decrease, and we’re beginning to see a resurgence of buyers, ready to make their mark.
Anticipated Changes and Homebuyer Behavior in 2024
As the market adjusts and mortgage rates inch down, we anticipate a gradual increase in buyer activity. For first-time homebuyers, this could mean more opportunities, but also more competition. Understanding market trends, interest rate movements, and inventory levels will be crucial in making informed decisions.
Strategic Advice for First-Time Homebuyers in 2024
Navigating a volatile market requires a strategic approach. Here are a few tips for first-time buyers:
- Patience is Key: The right opportunity may take time to arise. Don’t rush into decisions without thorough research. It will be competitive this year, stay the course and you will win.
- Financial Preparedness: Ensure your finances are in order, from credit scores to pre-approval for mortgages, to strengthen your buying position.
- Market Insights: Stay informed about local market trends, interest rates, and inventory changes to identify the best buying windows… like reading this blog!
Strategic Advice for Potential Home Sellers
In a market that has seen significant shifts since 2020, and incredible equity gains, current homeowners might be thinking about cashing in. While the low mortgage rates of the past may make the decision to sell less appealing, there are strategic approaches to consider for those looking to capitalize on the current market conditions:
- Understand Your Market Position: With your equity gains since 2020, you might be in a stronger position than you realize. Conduct a comprehensive market analysis to understand the true value of your property in today’s market.
- Timing is Everything: While overall sales are low, certain segments of the market remain active. Identify peak interest periods in your area and consider listing your home to align with these windows.
- Price It Right: Pricing your home correctly from the start is crucial. An overpriced home can linger on the market while underpricing can lead to potential losses. Work with a real estate professional to set a competitive price that reflects current market conditions.
While presidential elections introduce a degree of uncertainty into the market, a myriad of factors influence real estate dynamics. The resilience of the market in 2020 and the evolving challenges and opportunities in 2024 underscore the importance of staying informed and adaptable.
If you’re contemplating your first home purchase or looking to understand how the current market affects your current home, we’re here to help. Reach out to the Sackin-Stone Team for personalized advice, up-to-date listings, and expert guidance tailored to your unique needs. Let us help you navigate your journey to finding the perfect home in Orange County.
Remember, it’s never too early to call!