2020 was a year of struggle and challenge for people and industries, but the housing market stood firm in adversity. Now, in 2024, markets are recovering and stabilizing, adapting and evolving around new innovations and shifting demands.
Here are some trends and innovations to consider if you enter the housing market this year.
Rising Prices
Prices in the housing market have been on the rise for some time now, having more than doubled in the past 30 years. This trend is about to stay the same, but data shows that prices are now rising slower than in previous years, which is a good sign.
Low Inventory
The primary cause for the consistent rise in prices in the industry is a low inventory; too many people are trying to buy houses, and not enough homes. COVID-19 exasperated this issue further when people started trying to move to locations with lower infection rates. Even after the pandemic ends, it is unlikely that this problem will be resolved.
Rising Mortgage Interest Rates
Not long ago, the middle class could take on a mortgage to pay the full price for a new house and pay it back gradually over time. This has become increasingly difficult as mortgage rates have risen to impossible highs.
The COVID-19 pandemic positively impacted mortgage rates as interest rates across the country fell in 2020. Market analysts predict that this decline should continue downward throughout 2024.
Demographics
Since 2019, Millennials have surpassed Gen X and Baby Boomers as the dominant age group in the home-buying market. This trend will continue as more Millennials consider buying their first homes.
From Cities to Suburbs
More people have started to migrate away from urban city developments instead of looking for homes in smaller suburban communities. As the new predominant demographic in the buyers’ market, Millennials prefer suburbs over city residences because they are more affordable and experience lower crime rates.
Virtual Reality
As Millennials have taken over as the primary demographic in the housing market, the tech-savvy generation has brought technological innovations quickly, pushing the industry in a bold new direction.
One such innovation is using Virtual Reality (VR) in the housing market. Virtual Reality housing tours were already a niche practice offered by a few realtors and agencies before 2020. However, the pandemic saw VR becoming a popular method of conducting long-distance house tours.
VR home tours have many advantages over in-person ones for both agents and buyers.
- VR allows real estate agents to market and sell properties with little investment.
- It allows buyers to participate in several daily tours, making their home-buying journey much faster and more efficient.
- Thanks to VR, buyers can experience house tours from their homes and across cities and countries if they hope to move internationally.
- It allows potential buyers to experiment with the interior design and décor of the house by instantly customizing a digital 3D representation of it in VR, as per their liking, when such modifications to the real house would be time-consuming and expensive.
Smartphone Applications
Since smartphones started using applications over a decade ago, they have become an important part of our everyday lives. There seems to be an app for everything, and we are always connected to our smartphones in some capacity. Seeing this, real estate agencies have also decided to leverage the power of apps, creating their own apps that make the home buyer experience easier and more efficient. Apps allow buyers, sellers, and agents to remain connected and provide a platform upon which buyers can find the best options currently on the market.
Cryptocurrency
The sky-high price of Bitcoin has made it difficult for the virtual currency to function as a standard means of exchange. But with prices rising daily, the housing market may be the perfect space for Bitcoin to thrive. Experts believe the technology upon which cryptocurrency is produced and traded, Blockchain, could also be a tool for innovation in the housing industry.
Conclusion
In conclusion, the housing market, resilient in the face of the challenges of 2020, is now in a phase of recovery and adaptation in 2024. Despite ongoing struggles like rising prices fueled by low inventory, the market is showing a positive sign with a slower pace of price increases. Demographic shifts, particularly with Millennials as the dominant force, influence preferences toward suburban living and drive technological innovations. Virtual Reality (VR) and smartphone applications have transformed the home-buying experience, offering efficient and customizable solutions.
Moreover, the potential integration of cryptocurrency, such as Bitcoin, into the housing market reflects a dynamic landscape open to innovation. Navigating these trends and embracing technological advancements is crucial for those entering the housing market in 2024, ensuring a successful engagement with the industry’s evolving dynamics.
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