Slight drop in Zillow’s home sale projection

Zillow now expects 4.05 million existing home sales in 2024, down from last month’s prediction of 4.10 million. While the company expects a mild recovery in sales later this year, recent mortgage rate increases have dampened some of Zillow’s growth expectations from the start of 2024. Also in the report:
  • Zillow anticipates that home values will decline by 0.9% over the next 12 months.
  • New for-sale listings have seen a notable jump, up 15.5% year-over-year in April and up from 3.8% month-over-month

Our take
We continue to see the effects of those high mortgage rates. They’re making homes less affordable and keeping sales down. But we’re taking a wait-and-see approach to this latest forecast. We need to see whether we get a rate cut from the Fed. If we do, then this forecast goes out the window and all bets are off.