By 2024, home prices in the United States are expected to grow by 2.4% annually. Likewise, Fannie Mae’s Home Price Expectations Survey (HPES) projects growth of 2.7% by 2025.More than 100 experts from the housing, mortgage and academic sectors participated in the study.
This is done to produce forecasts of percentage changes in house prices across the country over the next five calendar years.
In this sense, the increase in housing prices in 2023, as expected by experts, amounted to 5.9%. This will be followed by slower growth in 2024 and 2025 of 2.4% and 2.7% respectively.
On the other hand, Doug Duncan, Senior Vice President and Chief Economist at Fannie Mae, touched on several important aspects of this topic.
He noted that survey participants expect housing price growth to slow in the coming years.
They also expect future mortgage rates to drop significantly from recent highs of 8%.
What could happen this year?
Likewise, other factors are expected to affect long-term interest rates. These include demographic trends, increasing budget deficits, the evolution of artificial intelligence and the transition to green energy.
Terry Loebs, founder of Pulsenomics, said that across all groups, the average expected rate of home price growth in 2023 jumped to 5.9%.
Thus, compared to the 3.3% level recorded in the previous survey (conducted by Pulsenomics), this represents a significant increase.
What will happen in 2024? The vast majority of experts surveyed do not foresee this trend continuing until 2024.
Loebs also emphasized that this forecast symbolizes an encouraging consensus among first-time homebuyers in this new year.