Market Update - December 2024
Market Action Index - December 2024
The market conditions remain similar to last month—slow. Many people seem drained from the election season, and the holidays add to everyone’s busy schedules. The biggest challenge remains affordability, a topic we've discussed extensively. As long as interest rates hold steady and job reports show positive growth, we’re likely to see this sluggish market persist.
The economy's resilience continues to face headwinds, but predictions for home prices in 2024 vary widely, that home prices could rise anywhere from 1.5% to 10%….depending on the source. Which is my humble opinion, is no opinion at all. We could probably safely say that every year here in San Diego. Are you a buyer and want to take advantage of a sluggish market?…we need to talk before the year ends…we need to get the wheels moving to make something happen in Q1.
Market Segments - December 2024
“According to a recent survey on homeowners’ insurance, the percentage of individuals experiencing difficulties in obtaining coverage has doubled over the past year, rising from 16% to 31%.”
Market Profile - December 2024
HOT TOPICS
Would you like a home valuation and neighborhood report every month? Those receiving these have really enjoyed them! If you’d like a free home report every month, all I need is your address and an email for you. It’s a great way to track home values, loan information, and know exactly what’s being bought and sold in your area Send me an email brendan.gail@kw.com to be added!
Service Sector Slowdown with Rising Prices:
The ISM services index showed a slowdown in November, with key components like employment and new orders declining. However, prices paid rose due to wage growth, complicating the Federal Reserve's goal of cooling inflation without hurting growth. Tariff concerns are adding uncertainty, particularly in electronics and hospital supplies.Residential Construction Boosts Spending:
Construction spending rose 0.4% in October, driven by a 1.5% increase in residential outlays, mainly from home improvement projects. Multifamily spending stayed flat, while nonresidential spending fell due to high interest rates and tight credit. Data center construction stood out, showing strong growth.Consumer Sentiment Mixed:
Consumer confidence hit a nine-month high in December, with optimism about current conditions boosted by the holiday season. However, future sentiment dropped to a six-month low as inflation and economic uncertainty persisted. Expectations of higher prices, partly due to potential tariffs, weighed on consumers.
Labor Market Recovery Supports Rate Cut:
November saw a rebound in payrolls with 227,000 jobs added after October’s disruptions. Wage growth exceeded expectations, but the unemployment rate rose slightly to 4.2%, giving the Federal Reserve reason to consider a rate cut in December.Affordability and Relocation Trends:
Affordability is the second biggest reason people relocate, following proximity to family. The South is the most popular destination due to better home values and favorable tax policies. Remote work and outdoor spaces are key priorities for movers, with job proximity less of a factor for many.
Hope you have a wonderful Christmas and Holiday season!
Reach out anytime! Call, text, or message me 😊
Brendan
P.S. I always appreciate referrals! It’s among the greatest compliments I can receive. If you know someone who is has questions about the real estate market, please send them my way. Thank you!