Home prices in Wichita will grow again in 2024, but not at the same rates seen in the years right after COVID, according to a new study out of Wichita State University.
Wichita home prices are expected to grow about 4% this year and 3.4% in 2024, compared to about 15% and 11% in 2021 and 2022.
“House prices were going up really, really, really fast over the last couple years,” said Stan Longhofer, the director of Wichita State’s Center for Real Estate. “Now they’re just going to go up what would be considered good, strong, steady appreciation for Wichita.”
The Center for Real Estate published its Wichita 2024 Housing Forecast, which focuses solely on single-family housing.
“What I would hope is that we’re returning to more of a typical normal market,” Longhofer said. “Even though it favors sellers, it’s not the insane market that we had over the past couple years.
“If you are wanting to buy a home, you need to be out there quickly. You need to be looking at the houses you’re interested in. You need to be making competitive strong offers,” Longhofer added. “You don’t have to do some of the really crazy things that were happening in 2021 and 2022, where people were waiving inspections and making really high bids above asking price.”
The city will continue to experience a significant housing shortage in 2024 that will make life challenging for potential homebuyers, Longhofer said.
“Although inventories of homes available for sale have risen over the past year, they still remain far less than they were in 2019 – levels that were already well below the 4 to 6 months’ supply needed for a balanced market,” the report reads.
Yet new home construction is forecast to be down 7.2%, to 1,255 new single-family permits, at the end of this year. Longhofer said that’s because of rising interest rates, which have made it more difficult to get financing to build new developments.
“The challenge is pricing,” Longhofer said. “It is really, really difficult to build a quality home that has all the features and everything that home buyers want below, say, a $300,000 price point.”
Rising mortgage rates have also curbed demand amongst buyers. And with a limited number of houses on the market, home sales are predicted to fall 10.4% by the end of 2023 and will continue to drop through 2024.
The National Association of Realtors is predicting, though, that the Federal Reserve will lower interest rates next year. The report forecasts that, should this happen, construction of single family houses in Wichita will rebound and grow by 8.8% in 2024.
