Are the Top 3 Housing Market Questions on Your Mind?
What's happening in the Kansas City housing market? There's a lot of confusion right now for many KC home buyers and sellers. You hear one thing in conversation with your friends, see something different on the news, and later read a headline on social media contradicting both of those thoughts. If you're thinking about making a move, this can leave many lingering questions. The Just Say Home real estate experts can help you gain clarity and confidence moving forward.
These are the top three questions many Kansas City homeowners are asking about today's housing market and the data to answer them.
What's the Future of Mortgage Rates?
Mortgage rates are reporting higher than in previous years. For those considering the purchase of a home, these elevated rates impact affordability. This influence is why so many Kansas City buyers want to know what to expect for mortgage rates in the coming months. The answer? While no one can say for sure because rates are unpredictable, we can explore historical trends to make an educated assumption.
One of these trends is a long-standing relationship between mortgage rates and inflation. When inflation is high, mortgage rates often follow suit. We can see this trend at play over the past year; inflation was up, so mortgage rates were as well. But now, inflation is easing, leading the Federal Reserve to pause their federal funds rate hikes recently. For this reason, many experts believe Kansas City mortgage rates will begin to decrease.
In some ways, we've seen hints of slightly lower mortgage rates in the past few weeks. However, these shifts have been volatile and will likely continue this way going into next year. While some ongoing variation is expected, the anticipation for 2024 is witnessing a downward trend. As Aziz Sunderji, Strategist at Home Economics, says:
"The bottom line is that interest rates are likely to be lower-perhaps even lower than many optimists think - in the weeks and months to come."
Where Are Home Prices Headed?
There was increased concern Kansas City home prices would crash this year, but data shows the opposite. In most of the nation, home prices are rising. Housing market experts anticipate this trend to continue at a slower pace - one that's much more typical for the housing market. This is a good thing!
Look at the Home Price Expectation Survey from Pulsenomics to see just how confident experts are in this continued appreciation. A national panel of over 100 economists, real estate experts, and investment and market strategists was asked about the home price forecast. As the graph below shows, the consensus is that Kansas City home prices will keep climbing next year and in the years to come.
Is a Recession Around the Corner?
Recession talk has been familiar over the past few years, but there's good news on that front! The Wall Street Journal (WSJ) polls experts on this topic regularly. This time last year, the majority of them expected a recession to have happened by now. However, as experts observe the leading indicators in the current market, many are changing their minds and saying the likelihood of a recession is diminishing. The latest results reveal more experts reporting that we're not headed for another recession (see chart below):
This is big news for the Kansas City housing market! While the 48% to 52% split seems close to half and half, the essential thing to focus on is that most of these experts think we've already avoided a recession.
What is the big takeaway from these three main questions? Current Kansas City housing data points to a lack of cause for concern. In fact, there are many signs of hope! As we head into the new year, talk with a Just Say Home real estate agent about the KC housing market questions on your mind. Their expertise and guidance can make the decision to buy or sell a seamless one!