Key Events Shaping Real Estate Through the End of 2024

The Weekly Recap

Good morning and happy Friday! Thanks to office workers, foot traffic in Manhattan is near pre-covid levels. Some investors believe that when all is said and done US interest rates will settle between 3% and 4% while other traders believe we will see a 50 basis point cut in September. The Fed’s preferred inflation gauge increased .2% as expected, US small business sentiment is improving, the NFL is back and AirBNB celebrates a year of being banned in NYC by begging the city to scale back short term rent regulations as business has fallen 83% in the city this year.

Key Events Shaping Real Estate Through the End of 2024

As we transition into the final quarter of the 2024 market cycle, the real estate market is poised for significant activity. Cooling temperatures usually correlate to a behavioral shift in how buyers and sellers approach the market. The economic landscape, interest rates and housing supply will all play critical roles in shaping market dynamics during these final months. Buyers may face stiffer competition as they seek to lock in favorable rates while sellers list their homes in hopes of capitalizing on heightened demand. Here are several upcoming events that can have a dramatic impact on the marketplace before the year is over.

September 17th/18th: Federal Reserve Meeting- This is the meeting that everyone has been looking forward to. It is universally believed the Jerome Powell will finally call for rate cuts of anywhere between 25-50bps. With mortgage rates already on their way down due to softening treasury’s, a rate cut would be a huge boost to the market place.

October 4th: US Jobs Report- Employment data can signal economic strength or weakness which can impact buyer and seller confidence. If the Fed reduces rates at its September meeting, the inflection of this number can either reinforce policy or shake it into a completely different direction.

October 30th: Q3 GDP Report- These reports provide insight into the health of the economy that impact consumer confidence and market behavior. Although this report wont show the full impact that a rate cut would’ve had if it occurred earlier in Q3, similar to the jobs report, can impact the frequency in which we see additional rate cuts.

November 5th: Presidential Election- Election cycles always prove as wait and see moments but with rate cuts imminent, we may see a more active election cycle than in years past. Once the election is settled and Americans have more insight into what the next four years will bring, we should see even more confidence returning to the market place.

November 6th/7th: Federal Reserve Meeting- Coincidentally (or not) the Fed meets immediately after the election and depending how the economy reacts to the anticipated rate cuts in September, could dictate the Fed’s decision to decrease rates not just at this meeting, but in the immediate future moving into 2025.

Market Performance

Here are how some other indexes and asset classes have performed as of this mornings opening bell.

NYC Market Update

Here is a view of new inventory that has come onto the NYC market over the past WEEK as well as newly signed contracts in Manhattan.

Mortgage Rate Update

Mortgage rates remained flat this week. Even though rates have come down over the summer, home sales nationwide have been lackluster. On the refinance side however, homeowners who bought in recent years are taking advantage of declining mortgage rates in order to lowers their monthly payment.

News You Can Use

• Rate Options Show Rising Bets on a Half-Point Fed Cut This Month Bloomberg

• Fed’s Preferred Inflation Gauge Shows Prices Increased in Line with Wall Streets Expectations in July Yahoo Finance

• Oaktree’s Marks Says Fed Cuts Won’t Take US Rates Below 3% Bloomberg

• The Peak Interest Rate Era is Over CNBC

• Yellen Says US Labor Market is Healthy Despite Slower Hiring Pace Reuters

• Fed’s Favorite Inflation Indicator Increased 0.2% in July CNBC

• US Small Business Surges, Sentiment Improves Reuters

• Foot Traffic in Manhattan nears pre-Covid Levels The Gothamist

• Bank of Canada Signals Further Cuts as Interest Rates Fall to 4.25% Financial Times

• US Job Openings Decline to Lowest Level Since January 2021 Bloomberg

• Airbnb Urges NYC to Scale Back Short-Term Rental Regulations Bloomberg

• Airbnb In NYC: One Year Later Skift

The Deep Insight

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