Economic & Real Estate Trends In 2024
What economic and real estate trends can we expect to help shape the market in 2024?
In 2024 we can expect the acceleration of some recent trends, the peaking of others, and return of others. Understanding these dynamics will enable investors to stay ahead of the curve with their capital, and achieve the best yields.
Businesses Focus On Cost Cutting
Companies of all types are throwing themselves into cost-cutting mode. Even the largest. Everyone is beginning to watch every penny they spend and are cutting back on all but the essentials.
In addition to direct layoffs, this will also have a waterfall effect on others that normally rely on them for income. Such as their vendors and merchants.
A Reckoning For AI and Technology
While AI is still in its infancy in many ways, more and more consumers are experiencing the bitter taste of automation and AI that just doesn’t serve them well.
As consumers also pay more attention to their own spending, and choose to spend where they can count on good customer experiences, it shouldn’t be surprising if there is some push back on companies using these technologies.
This dip will last until the technology and user experiences are improved upon, and people feel more confident about the state of and direction of the economy and their own finances.
More Retirement Plan Money Coming To Market
Between layoffs, poorly managed plan performance, and the usual scandals that show up in this phase of the economic cycle, we can expect more individuals to either liquidate their 401ks and IRAs, or move them to self-directed options. Much of this could well end up being directed towards alternative assets like real estate.
Corporate Relocation Costs
Although more and more workers will become independent contractors and work remotely, some old companies will still crave the comfort of having people in the office and on site.
As the real estate market rotates, and living costs remain high, we may see a return of these companies having to offer more moving and relocation help to workers and new hires.
This may include renting corporate apartments for them in their new cities, and helping to cover the costs of holding onto mortgages of homes in their old locales, which they haven’t sold yet.
The Distress Bubble Continues To Grow
While it may not burst yet, recent trends and current economic conditions suggest we’ll continue to see the mountain of defaulting auto loans, credit cards, and distressed business debt grow. Prices are still too high for wage growth, and people are running out of savings.
Of course, any crisis bailouts that are rolled out this year could help change this dynamic. Otherwise, we’ll see more off market deals on assets available to well-connected institutional investors.
The Move To Affordability
All of the above indicates that we’ll see even more people and companies moving for affordability. As well as towards renting versus buying homes. This will be great for those acquiring rental properties to meet the growing demand.
