The 2024 housing market is expected to be a challenging one for both buyers and sellers. High mortgage rates, steep home prices and low inventory levels are some of the factors that will make it harder to find a good deal or sell your home quickly. But not all markets are created equal. Some areas will fare better than others, while some will face more risks and uncertainties.
In this post, we will look at some of the real estate markets that you should avoid in 2024, based on the latest data and forecasts from various sources. These are the markets that are likely to see lower price growth, higher inventory, lower demand, or a combination of these factors. Of course, these are not definitive predictions, but rather general trends that you should be aware of before making any investment decisions.
Toledo, OH
Toledo, OH is ranked as the top real estate market of 2024 by Realtor.com1, based on its strong price and sales growth, low unemployment rate, and affordable housing. However, this may also mean that the market is reaching its peak and may soon face a slowdown or a correction. Toledo has seen a massive influx of buyers from other states, especially from California, who are looking for cheaper and more spacious homes. This has driven up the demand and the prices, but also increased the competition and the risk of overvaluation. Toledo’s median home price is expected to rise by 15.5% in 2024, compared to the national average of 5.9%1. This may make it harder for local buyers to afford a home, and also reduce the profit margin for investors. Additionally, Toledo’s economy is heavily dependent on the auto industry, which may face challenges due to supply chain disruptions, labor shortages, and environmental regulations. If the auto sector suffers, so will Toledo’s job market and housing market.
Los Angeles, CA
Los Angeles, CA is one of the most expensive and competitive real estate markets in the country, and also one of the most volatile. The city has seen a roller coaster ride of price fluctuations, inventory shortages, and demand shifts in the past few years, influenced by factors such as the pandemic, wildfires, migration patterns, and tech innovations. In 2024, Los Angeles is expected to face a cooling off period, as buyers become more cautious and selective, and sellers face more competition and lower offers. According to PwC, Los Angeles is ranked as the lowest market for investment prospects among the 80 largest metro areas in the U.S.2. The report cites the high cost of living, the lack of affordability, the regulatory barriers, and the environmental risks as some of the reasons for the low ranking. Los Angeles’ median home price is expected to grow by only 2.5% in 2024, compared to the national average of 5.9%1. This may not be enough to cover the high taxes, fees, and maintenance costs associated with owning a home in the city.
New York, NY
New York, NY is another expensive and competitive real estate market that is facing a slow recovery from the pandemic. The city was hit hard by the health crisis, which caused many residents to flee to the suburbs or other states, and many businesses to close or reduce their operations. This resulted in a glut of inventory, especially in the rental market, and a drop in prices, especially in the luxury segment. While the city has seen some signs of improvement in 2021, thanks to the vaccine rollout, the reopening of the economy, and the return of some workers and tourists, it still faces many challenges and uncertainties in 2024. According to PwC, New York is ranked as the second lowest market for investment prospects among the 80 largest metro areas in the U.S.2. The report cites the high taxes, the strict regulations, the political instability, and the social unrest as some of the reasons for the low ranking. New York’s median home price is expected to grow by only 3.8% in 2024, compared to the national average of 5.9%1. This may not be enough to offset the high cost of living, the high risk of infection, and the low quality of life in the city.
Conclusion
These are some of the real estate markets that you should avoid in 2024, based on the latest data and forecasts. Of course, these are not the only markets that may face difficulties or opportunities in the coming year. There are many other factors that may affect the performance of any given market, such as the local economy, the demographics, the infrastructure, the climate, and the consumer preferences. Therefore, it is important to do your own research and due diligence before making any investment decisions. Remember, real estate is not a one-size-fits-all proposition. What works for one market may not work for another, and what works today may not work tomorrow. The key is to be flexible, adaptable, and informed. Happy investing!
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