Lowcountry's Housing Market Trends and Predictions for 2024
Federal Reserve's Impact: Interest Rates and Real Estate Trend
2024 is upon us and the housing market and economy of the Lowcountry continues to do well. In this article we’ll be taking a look at how real estate performed in 2023 and see what 2024 might have in store.
2023 Recap: Market Trends, Rent Changes, and Home Values
In 2023 the Federal Reserve further increased interest rates in the fight against inflation; pushing rates from 4.25%-4.5% up to 5.25%-5.5%. Mortgage rates for investors touched 8% towards the end of 2023, but have declined to around the 7%-7.5% range. This has slowed the home appreciation widely seen in the Lowcountry over the past few years down to an average of 2.5% home value appreciation for the year according to Redfin. In addition, the median days on market has declined by about 2% year over year according to Realtor.com Rent increases have continued to increase but at a slower rate than 2021 and 2022. Based on our data, the average house renting for $2,000 on January 1st 2023 would rent for $2,150-$2,200 on January 1st 2024.
Projections and Opportunities for 2024
Now that 2023 has come to a close let’s see what 2024 might bring for real estate in the lowcountry. The Federal Reserve says it expects to drop rates three times in 2024 as inflation has continued to slow down. The expectation is that mortgage rates will also decline by about 1% through 2024 according to various lenders and the National Association of Realtors. Based on what we are currently seeing where home inventory is still below the demand, our housing market prediction for 2024 in Bluffton, Hardeeville, and Hilton Head is that we will continue to see price increases for the year.
Growth in Hardeeville, Bluffton, and Hilton Head
If these projections hold true then house prices may continue to appreciate as lower mortgage rates tend to increase home values. The next year or two may provide opportunities for investors to refinance into less expensive mortgages. Although, the super low rates seen in 2020 and 2021 most likely won’t be seen for a very long time.
The Lowcountry continues to grow and 2024 shows no signs of slowing down. For example, HIC Land in conjunction with developers D.R. Horton will be developing 2,600 acres in Hardeeville to build homes, retail spaces, and other facilities.
Developments such as Margaritaville are continuing to open up new sections and the New River section of Bluffton is continuing to expand. The population growth in Bluffton has reached the point where a new elementary school is being built; with the goal of opening for the 2025-2026 school year.
It is an exciting time to be a property owner. With the prospect of lower mortgage rates in the coming year, 2024 may be a great year for real estate in the Lowcountry.