Even though data continues to be released that shows home prices are stable, and even rising in many areas of the country, worry about a home price crash in the near future remains.

According to a recent Fannie Mae survey, 23% of consumers think home prices will fall over the next 12 months, while another survey by LendingTree showed 35% of Americans hope home prices will crash.

What many potential buyers don’t realize is that home prices have already fallen, have since stabilized, and are expected to rise in the years ahead according to the latest expert forecasts.

Experts Project Ongoing Price Appreciation

While nobody should base a decision, or rely, on what a handful of experts say, the Home Price Expectation Survey by Pulsenomics is a survey based on the opinions of over 100 economists, investments strategists, and housing market analysts.

The latest quarterly release shows this group of experts expects national home prices to go up every year through 2027;

Frisco Home Prices

While home prices in many parts of the country have recovered all of what was lost since the peak, that isn’t the case here in Frisco.

Homes prices in Frisco remain near their low point of 19% below peak pricing as of November 2023.

Due to different market dynamics, all real estate is ultimately local and median home prices here in Frisco are heavily influenced by new construction. Based on November’s numbers, the median sales price of single family homes in Frisco for all construction types was down 3.4% year-over-year as shown on the following graph:

How About in 2024?

While hearing that home prices are down year-over-year might be welcome news to some potential buyers, I wouldn’t get too excited.

Home prices have remained resilient in the face of high mortgage rates due to the imbalance between supply and demand. Even though demand has fallen, supply has as well, which has helped to keep local home prices elevated.

Here’s a look at how the number of homes for sale now compares to previous years;

The number of homes for sale has been falling since late September, which is normal for this time of year, and is a leading indicator for home price movement in the 1st quarter of 2024. In order for home prices to fall we would need to see the supply of homes for sale rise.

The other leading indicators I look at are current list price trends and what percentage of original list price are homes typically selling for.

Currently, homes in Frisco are selling for 96% of the original list price. That means, even with price reductions, the final sales price of a home is currently within 4% of the price it was originally listed for. This percentage usually starts trending upward after the first of the year.

With that information, when we look at current list price trends we can get a good gauge on where sales prices will be in the 1st quarter of 2024:

The graph above shows both the 7-day (dotted) and 90-day (smooth) trend lines. It’s typical for the 90-day trend line to decline in the 4th quarter, but closer examination of the 7-day trend line shows us that list prices have remained at about $717,000 since mid-September.

With homes taking approximately 56 days to go under contract currently, homes that are listed for sale now will most likely go under contract later this month or in January and close in February or March.

If those homes sell within 4% of $717,000 then 1st quarter 2024 prices will be either equal to, or just above where prices were in 2023.

CLICK HERE to See All the Latest Frisco Market Trend Data

Bottom Line

While there is nothing in the data currently to suggest home prices will decline in 2024, it is always possible that something unexpected could happen.

Saying that, if mortgage rates continue to decline, and housing supply remains tight, here in Frisco we should expect to see home prices increase in 2024 at a pace higher than the national forecast.

If you, are anyone you know, is considering buying a home in 2024, let’s Schedule a Call to put a game plan together to make your dream of a new home a reality.

New Construction offer some of the best buying opportunities in today’s market. See below for all new construction homes currently for sale in Frisco and Prosper.


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