With a new year upon us and interest rates expected to dip, there’s reason to be excited about the housing market’s future. To help forecast the real estate trends of 2024, AD PRO has tapped developers, stagers, and interior designers for their insights on what could define the industry this year.
Sustainable design attracts more buyers
Sustainability has long been a trendy cherry-on-top feature for home buyers, but in 2024 some industry experts are predicting it will become a much higher priority for prospects as they search for their dream home or vacation property. AD PRO Directory real estate development, staging, and interior design firm The Brooklyn Home Company has been creating spaces with passive house principles in mind for years. Its cofounder Bill Caleo notes a recent shift among consumers.
“I think the real estate community really has been educated and understands sustainability more and more coming in,” Caleo says. “Pre-pandemic, when I said we wanted to invest in it, everyone—the realtor community, our past customers—appreciated it, but I don’t think they really got it.” Now, people get it from the jump: “They’re seeking [sustainability] and asking a lot of questions about it, so it really has been a big change in perception. It’s been a much quicker change than I ever imagined, to be honest with you.”
For the founders of Hidden Rock Development, the next phase in sustainability comes down to education around the elements of design that aren’t immediately obvious to buyers. With their Moccasin Flats project in Utah, just outside of Zion National Park, they worked to ensure sustainability was part of the foundation of the project—from sourcing local materials to figuring out the best positioning of the structures themselves. “There’s a whole bunch of trendy stuff when it comes to sustainability, but [it] phases in and out so quickly,” says cofounder Dallin Jolley. “What doesn’t phase in and phase out are the core [sustainable] design elements, where the house is designed and built sustainably from the ground up.”
More buyers want to take the plunge—literally
From single-family houses to luxury condos across the country, cold plunges and infrared saunas are becoming the new standard amenities. The former, which are deep baths made specifically for ice cold immersions, have had a particularly big year—USA Today, NPR, and Business Insider have all covered their breakout popularity in 2023. Though some are content to plunge irregularly in a lake or at a spa, real estate trends are proving more and more people want the opportunity to partake habitually in their own residences, whether it be in a purpose-built tub or a prefab option, like those sold by Plunge.
As Bryan Grandison, director of lifestyle services at full-service development company Extell, emphasizes, the trend is less about cold plunges and infrared saunas replacing the old standards and more about a widening field of amenities. Extell’s waterfront condo One Manhattan Square features a dizzying array of options, including a sunken tranquility garden, a hammam with a cold plunge, a hot tub, a sauna, and saltwater swimming pool, among other amenities. Grandison has noticed increasing popularity in the use of these extras across the spectrum. “I think this really stems from coming out of the pandemic because you had such a long period of time that people had a lot of time on their hands, and they realized how important self-care is for their overall health and well-being,” Grandison says. “People want to feel good about themselves, and these amenities are really geared to help them with that.”
American buyers will feel some relief
According to real estate data company Clever, in 2023 a majority (51%) of Americans thought it was a bad time to sell a home and an even greater number (53%) thought it was a bad time to buy. It was a year of worryingly high mortgage rates, with the average 30-year fixed mortgage rate hitting 8% for the first time since 2000 this October. Many owners who secured a 3% 30-year fixed a couple of years ago sat tight in the midst of these high rates, as did prospective buyers. After a year of waiting out, 2024 is expected to bring welcome change.
The chair of the Federal Reserve, Jerome Powell, stated in a press conference that the Fed expects to cut interest rates three times in 2024. Though there’s no predicting exactly when these rate cuts will come, it’s reasonable to assume that buying will be a lot easier to stomach for many in the coming year. Buyers are likely to have more inventory to choose from, too, as more homeowners feel comfortable letting go of their old interest rates.