2024 unlikely to bring normalcy to Des Moines real estate market
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2023 was a "transitional year" for the Des Moines housing market post pandemic — and 2024 doesn't look likely to reach normalcy either, says Ted Weaver, a RE/MAX broker.
Why it matters: 2024 will be "another transitional year but with more stability," the former president of the Des Moines Area Association of Realtors says, thanks to still-high interest rates and price appreciation that have been keeping both demand and supply low.
Driving the news: Weaver and his entire industry are hoping interest rates will decline in the first half of 2024 towards 5-6%.
- That would shore up the demand side of the equation and encourage new buyers as well as existing homeowners to "upgrade their current housing situation," he says, which would in turn alleviate a supply crunch.
Catch up fast: The metro's market has moved past the "frenetic pandemic era market where demand far outstripped supply and sellers typically sold above list price and within days of listing," he said.
- Now we're in a "more stabilized, albeit slower market where demand has substantially ebbed."
The big picture: If the economy is steady, rates could land around 6%. If the economy stumbles, mortgage rates could fall more significantly, Bankrate chief financial analyst Greg McBride, told Axios last month.
Reality check: Lower mortgage rates won't clear all buyer hurdles, and actually could push home prices higher if demand surges and inventory remains low.
- This will be especially hard on first-time buyers in the starter home price range who have felt the effects of high interest rates and high prices the most, Beverly Hills agent Beatrice De Jong told Axios' Brianna Crane recently.
Between the lines: Similar to 2023, sellers in 2024 will have to put effort into curb appeal and maintenance before listing, Denver Compass agent David Schlichter told Axios.
- "The days of swiftly and inexpensively flipped homes lacking style are behind us as we approach 2024," De Jong said.
- Weaver says the same will be true in Des Moines.
What we're watching: Weaver predicts the metro won't see a more balanced and "normal" real estate market again until 2025.