The housing market has been incredibly turbulent in recent years, both nationally and in Staten Island specifically. Currently, home prices remain high, and interest rates are higher than they have been in over twenty years, leaving buyers very weary of purchasing in these conditions. But as everyone knows, the market can change very quickly. Therefore, the question remains as to what to expect in 2024 for the Staten Island housing market.
The State of the Housing Market in General
To say the housing market's current conditions are challenging is a massive understatement. Home prices are up nearly 4% year over year, the median asking price for existing homes is up 4.6% year over year, and sales are down at a rate of 15.3% year over year. Further, the recent interest rate hikes have eaten away at buyer affordability, meaning most buyers can afford less than they might be able to during more favorable conditions.
On a national level, opinions are mixed in terms of what to expect in 2024. Some experts expect a potential drop of between 5% and 10% due to factors including weakened demand, affordability issues, and economic uncertainty. Others predict rising prices due to steady demand combined with low supply but acknowledge that factors such as local market conditions, employment trends, and regional factors may play a huge role in determining how any particular housing market may look in the upcoming year.
Many experts expect interest rates to be lower in 2024 than in 2023, but it's not expected to be a tremendous difference. Currently, the mortgage interest rates are so high that most people who want to buy are waiting for more favorable conditions, while many sellers are waiting until more buyers are interested since increased demand generally favors sellers.
The Fed is expected to lower rates once inflation begins to decline and the economy slows down, likely in 2024. Rates are expected to range between 5% and 7%. The more mortgage interest rates drop, the more buyers and sellers will return to the market. But with the general consensus standing that the likely interest rate will be at or around 6% - which is still high – there may not be a ton of increased demand nationally.
The State of Staten Island's Housing Market
The real estate market in Staten Island deviates substantially from national trends. While nationally, it is considered to be a seller's market, Staten Island's housing market – even in the current economic climate – is considered to be neutral, only slightly leaning toward a buyer's market. At just over $600,000, the median home price in Staten Island is also above the national average.
Further, while it has been a tough year for most housing markets, Staten Island also fared better in other dimensions. The market value of single-family properties in New York City increased 8.3% in early 2023, with homes in Staten Island experiencing the largest increase at 12.1%. With many markets in New York City expected to grow by 7% or more in 2024, it can be reasoned that Staten Island will continue to remain a strong housing market.
The reality is that the housing market, both on a national level and in Staten Island, remains uncertain. While an increase in sales and a decrease in the mortgage interest rate are expected, there are no guarantees. However, Staten Island's strong performance, even in the extremely tough conditions found in 2023, bodes well for the local housing market. The ability of Staten Island's market to remain resilient throughout 2023 indicates it will likely perform more strongly than other areas of the nation, even if conditions remain challenging throughout 2024. The fact that more sales are expected, combined with a likely lower mortgage interest rate, are indicators that Staten Island may have a robust market in 2024. And if conditions become more favorable than expected in 2024, Staten Island demand will likely increase accordingly.
Knowing when to buy or sell a home can be a considerable challenge. But timing your sale or purchase can often impact the price by tens of thousands of dollars. Expert guidance from trusted professionals who have an in-depth understanding of the nuances of the real estate market in Staten Island can be the key to ensuring your sale or purchase works in your favor. To learn more about whether or not 2024 will be an excellent year for you to make a move, contact the experts at Wonica Realtors today!
Wonica Realtors & Appraisers are Staten Island's #1 independent full-service real estate firm, serving the needs of the community for over 30 years. Whether you are buying, selling, renting, or relocating, our staff of highly trained professionals will provide quality realty services with personal attention to your individual real estate needs.