TAMPA, Fla. — You might be worried about a potential housing bubble if you suffered through the Great Recession of 2008 and 2009. We talked to real estate experts about what the real estate market could look like in 2024.
In October, mortgage interest rates soared to their highest level in 23 years, 7.9%, as home prices went sky-high.
On Dec. 13, the Federal Reserve announced a continued pause on raising rates. It was a welcome sign after 11 rate hikes from early 2022 through mid-2023. Home prices have dropped substantially over the past several months from the highs reached in 2022.
"We're not looking at what happened in 2008- 2009?" ABC Action News reporter Michael Paluska asked Jay Quigley, president of Greater Tampa Bay Realtors.
"Not at all. Not at all that was that was fueled by lax banking regulations. And absolutely not. We're we're not predicting that at all."
"So the market will correct itself and equalize? There won't be a bubble that pops?" Paluska asked.
"It's interesting because we've heard that phrase in mainstream media all year: when's the bubble gonna burst? When's the bubble gonna pop? And, you know, at least at my office and my firm, we are tracking that; we've been tracking it since 2008. Because we don't ever want to be caught with the proverbial pants down again," Quigley said. "And it seems that all the economists that I'm listening to and following are saying that if we have something, it's going to be kind of a soft landing, it's not going to be a jump off the off the side of the cliff."
"Is it okay to buy now?" Paluska asked.
"If you have to buy and you want to buy, and you have the finances to do so, let's do it," Quigley said. "Let's get you in at the best price that we can. And when interest rates change, they will then refinance, and we just go on our merry way."
Realtor Stella Tornabene Sheridan told Paluska the market is in transition.
"And we have been seeing that shift on the market," Tornabene Sheridan said. "One house could go under contract in four days; another house could be sitting for 120 days. So, although it's a seller's market, it's shifting into a neutral market based on days on the market, and then the path could transition to a buyer's market. Sellers are still in a great position to sell their home because inventory is still low."
We also talked to Dr. Lisa Sturtevant, chief E=economist at Bright MLS, one of the nation's most extensive multiple listing services that track housing data.
"I think there's going to be a little relief for homebuyers in 2024," Dr. Sturtevant told Paluska. "I think for two reasons. I think first mortgage rates, as we've seen over the last few weeks, are coming down. And I think they'll come down a little further. But more importantly, we're going to see more inventory in 2024 than we had in 2023. Giving buyers more choices. It is 100% about inventory. Though. If we have more inventory coming onto the market, we'll have more sales, and we're expecting nationally, anyway, inventory to be up almost 10%, still low by historical standards. But I think that's moving in the right direction."
Dr. Sturtevant tells Paluska the pandemic real estate market is over.
"I think gone are the days of a lineup of 50 people. But I do think buyers are going to find the market still competitive; there'll be other people out there that they'll be competing with for those listings, and they need to be prepared with their finances lined up with their offers ready, there's not going to be a lot of time to sit back even as inventory increases a little bit," Dr. Sturtevant said.