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Will the 2024 housing market be as bad as the 2023 market? How did the 2007-2008 financial crisis trigger today’s affordable housing struggles? Why is homeownership a pipedream for many Americans?

Stricter lending standards and sky-high home prices have rendered homeownership increasingly unattainable for many Americans. Despite slight improvements expected in 2024, long-term housing affordability remains uncertain due to supply shortages, high prices, and increasing economic inequality.

Keep reading for an idea of what’s in store for the year ahead.

The Housing Affordability Crisis

Homeownership, a longstanding emblem of stability and prosperity in the US, is becoming a distant reality for many Americans now shut out by the escalating affordable housing crisis.

Here are economists’ predictions for the 2024 housing market.


The roots of today’s affordable housing slump trace back to the 2007-2008 financial meltdown, which led the housing market to crash. The upheaval resulted in stricter lending rules that made it harder for people to qualify for mortgages and triggered a sharp drop in new home construction.

Homeownership has historically been considered a cornerstone of the American Dream, giving families a chance to build wealth and stability over time. But the rate of homeownership has been dropping.

The Current Affordability Crisis 

In recent years, sky-high home prices, rising mortgage rates, and a shortage of homes for sale have put home buying out of reach for many Americans. 

Experts say that, as a result, the American dream of homeownership is fading for a growing number of Americans. Half of all renters are buckling under financial pressure, spending more than 30% of their income on housing.

The crisis highlights the growing divide between individuals fortunate enough to jump on the property ladder early and those who may have family backing.

Outlook for 2024

The outlook for the affordable housing crisis in 2024 hinges largely on what happens with mortgage rates, home prices, and inventory levels. Most experts predict that mortgage rates will continue to decline from their 2022 peaks, with estimates for an average 30-year fixed rate running between 6.5% and 7.1%

Economists say this could improve housing affordability by 5%, assuming incomes continue to rise at recent rates and home prices increase moderately, as expected. However, even this would only improve the situation marginally.

Further, economists largely agree that low housing inventory will continue to plague the market this year:

Looking Ahead 

Experts say that significant, long-term improvements in the housing crisis depend largely on cooling interest rates and meaningful government policy changes. If marginal interest rate declines from 2023 continue into 2024, as the Federal Reserve anticipates, market activity may increase.

However, to date, government policy efforts have shown limited effectiveness in moving the needle on housing affordability and supply.

2024 Housing Market Predictions: Will It Improve?

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Hannah Aster

Hannah graduated summa cum laude with a degree in English and double minors in Professional Writing and Creative Writing. She grew up reading books like Harry Potter and His Dark Materials and has always carried a passion for fiction. However, Hannah transitioned to non-fiction writing when she started her travel website in 2018 and now enjoys sharing travel guides and trying to inspire others to see the world.

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