Housing trends refer to shifts and patterns in the real estate market. These patterns influence the buying and selling of real estate, rental housing, and how residential properties are developed. These trends are shaped by many factors, including economic conditions, demographic changes, and consumer preferences. Trends can shift throughout the year. Here are nine housing trends we’ve seen take shape in 2024.
1. Increased Demand for Affordable Housing
You’ve most likely noticed rising home prices and higher interest rates. This makes housing affordability a significant concern. According to CNBC, home prices are 47% higher than they were in 2020 and 5x the median household income. Builders and policymakers are focusing on creating more affordable housing options for first-time buyers and lower-income families, but it will take time to increase the supply of more affordable housing.
2. Suburban Growth
The demand for larger homes with outdoor space continues, especially in suburban areas. Remote work trends have encouraged people to move away from dense urban centers for more space and affordability. With the flexibility of location, home buyers are looking for that dream in a great neighborhood with recreation, good schools, peace and quiet, and less congestion.
3. Multigenerational Living
More families are choosing homes designed for multigenerational living. Homes that feature separate entrances, in-law suites, or adaptable layouts to accommodate extended family members are in demand. Multigenerational living allows for shared housing costs. Family members can help each other take care of young children or elderly parents. They can work together on chores and home responsibilities to ease the load.
4. Smart Home Technology
Homes with integrated smart technology are still cutting edge, but are becoming more common. Features such as automated lighting, security systems, and climate control, are becoming a standard expectation for many buyers. Many new homes are built with systems that can be controlled with apps from your phone, like controlling temperature, turning on lights, and opening doors.
5. Rise of Build-to-Rent Communities
Nearly 44 million housing units were rented in 2024, making up 34% of U.S. households. As renting remains a more viable option for many people, developers are creating entire communities of rental properties. Large apartment and townhouse communities are springing up with amenities comparable to those found in traditional housing developments, such as fitness centers, shopping plazas, and restaurants.
6. Urban Redevelopment
In urban areas, there’s a push to repurpose underutilized spaces or vacant buildings. This can include properties like offices or warehouses that are no longer being used for commercial purposes. These buildings are converted into residential housing units to meet the growing demand for city and town living.
7. Tiny Homes and ADUs (Accessory Dwelling Units)
Tiny homes and ADUs are growing in popularity. They provide affordable, simple, and flexible living solutions. They appeal to younger buyers, downsizers, and those looking to generate rental income. A tiny home can be placed in a small area, can often be transported, and they are low in cost compared to traditional housing.
8. Market Uncertainty and Cautious Buying
Economic fluctuations have led to cautious home buying. Potential homeowners are delaying purchases or downsizing due to high mortgage rates and inflation. They wait in hopes of lower interest rates and a decline in home prices. Those who already own a home are concerned they will not be able to find a replacement home.
9. Technology in Real Estate Transactions
During the pandemic, and the years following, more homes than ever were bought sight unseen. Tools such as virtual tours allowed buyers to view homes remotely. Digital signatures for documents in real estate transactions are commonly used. Even loan documents are being signed digitally prior to settlement, streamlining the process. Technology is making buying and selling homes more efficient and transparent.
Housing trends can vary depending on location and market conditions. What is emerging nationally may be different than local developments. If you would like specific housing information for our local area, please reach out.
By Launch Kits