ARE HOME PRICES COMING DOWN IN 2024???

ARE HOME PRICES COMING DOWN IN 2024???

What are home prices going to do in 2024 and beyond? Let's think about what would actually cause prices to come down. And the first thing, the biggest thing that comes to mind is decreased demand, right? Obviously, if there's less people trying to buy homes, then prices should go down. But this year in 2023, we've already seen one aspect of decreased demand because interest rates this year have been higher than what most people have been accustomed to recently. The volume of transactions and the demand has gone way down this year. Interestingly enough, home prices have stayed at the same level and actually they've increased a little bit year over year. What is really like the driver for housing demand, right? And in my opinion, the biggest would be jobs and employment. If people don't have jobs, they're not going to be buying homes and they can't afford homes. So of all the things that go on in the economy, I like to look at unemployment figures and unemployment forecasts. And it's interesting because the Bayer College of Business from UH, they predict that over the next year or so, Houston will continue to add jobs, that the job market will see growth. So if we're continuing to add jobs in Houston, then the demand for housing should continue to be strong. The other thing I think about as it relates to the Houston economy specifically is like for the longest time historically, our economy is tied to oil and gas. And if you remember in 2020, the price of oil plummeted. It was terrible. And this is around the same time that COVID happened too. And I remember during this time, there was a lot of restructuring in the oil business, a lot of layoffs. Nevertheless, the housing market was still steady. We didn't see a crash in hoWhat are home prices going to do in 2024 and beyond? Let's think about what would actually cause prices to come down. And the first thing, the biggest thing that comes to mind is decreased demand, right? Obviously, if there's less people trying to buy homes, then prices should go down. But this year in 2023, we've already seen one aspect of decreased demand because interest rates this year have been higher than what most people have been accustomed to recently. The volume of transactions and the demand has gone way down this year. Interestingly enough, home prices have stayed at the same level and actually they've increased a little bit year over year. What is really like the driver for housing demand, right? And in my opinion, the biggest would be jobs and employment. If people don't have jobs, they're not going to be buying homes and they can't afford homes. So of all the things that go on in the economy, I like to look at unemployment figures and unemployment forecasts. And it's interesting because the Bayer College of Business from UH, they predict that over the next year or so, Houston will continue to add jobs, that the job market will see growth. So if we're continuing to add jobs in Houston, then the demand for housing should continue to be strong. The other thing I think about as it relates to the Houston economy specifically is like for the longest time historically, our economy is tied to oil and gas. And if you remember in 2020, the price of oil plummeted. It was terrible. And this is around the same time that COVID happened too. And I remember during this time, there was a lot of restructuring in the oil business, a lot of layoffs. Nevertheless, the housing market was still steady. We didn't see a crash in home prices. And actually, like everybody else during 2020, we saw a housing boom. So the point is, despite one of our major industries basically like bottoming out, we still saw a healthy housing market with home prices increasing. So when I think about these things, I don't see any drivers for real estate home prices to decrease next year. And if anything, the things that we're seeing are implying that home prices will only continue to increase next year and beyond.me prices. And actually, like everybody else during 2020, we saw a housing boom. So the point is, despite one of our major industries basically like bottoming out, we still saw a healthy housing market with home prices increasing. So when I think about these things, I don't see any drivers for real estate home prices to decrease next year. And if anything, the things that we're seeing are implying that home prices will only continue to increase next year and beyond.


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