June '24 Market Update

• Since January 2024, prices have climbed 10.6%, reaching an all-time high in May 2024. Similarly, the median list price per square foot hit an all-time high in April and again in May 2024. Affordability for homes has reached a record low.
• In May, the average 30-year mortgage rate fell to 7.03%, dropping 0.19% from the 2024 high reached in April. The Fed has expressed hesitation around lowering rates due to higher-than-desired inflation. Currently, we expect rates to remain between 6% and 8% for the rest of 2024.
• Sales fell 1.9% month over month, while inventory rose 9.0%. The combination of rising prices and high interest rates has continued to price more buyers out of the market, slowing sales.

Home prices rose 5.6% to $418,900, the highest ever, with demand still strong despite high mortgage rates. Inventory is at its highest since August 2020, which may slow price increases. The Fed held rates steady, with rate hikes unlikely. For local insights, see the Local Lowdown.

BIG STORY DATA

THE LOCAL LOWDOWN

• The median single-family home prices in San Mateo, Santa Clara, and Sonoma reached record highs in May. As more new listings come to market, we expect prices to continue rising and to reach new highs during the summer months.
• Active listings, sales, and new listings rose across most of the Bay Area month over month, which are all beneficial for the housing market. We expect inventory to increase into the summer and return to a more normal market after the slowdown experienced over the past year and a half.
• Months of Supply Inventory has declined sharply in 2024, indicating that buyer competition is ramping up. MSI implies a sellers’ market in most of the Bay Area.

 In May, median single-family home prices hit record highs in San Mateo, Santa Clara, and Sonoma, with overall Bay Area prices near all-time highs, while high mortgage rates and low inventory continue to drive prices up, potentially slowing sales later this year.

In 2024, single-family home inventory, sales, and new listings in the Bay Area have increased significantly month-over-month, driven by more new listings, resulting in healthier market conditions except in San Francisco.

In May 2024, the Months of Supply Inventory (MSI) fell, indicating a sellers' market across the Bay Area, with MSI below three months in most counties. Exceptions include single-family homes in Napa (buyers' market) and condos in Alameda and San Francisco (balanced markets). San Francisco's MSI has been notably variable over the past year.