Mississippi Real Estate Market: What to Expect in 2024 and 2025?

The current median home sale price of $262,500 is rising sluggishly at 1.3% YoY. Moreover, homes spend 38 days on market with 7 days of YoY growth. This indicates that the real estate market in the Hospitality State is now slightly less competitive.

Additionally, only 1,776 homes were sold in June 2024, down from 1,991 in June, 2023. This decline suggests sellers are receiving fewer offers, mainly due to the recent NAR settlement. Concerns about selling prices and agent compensation have contributed to this market sluggishness.

The NAR settlement has removed the buyers’ agent compensation from the MLS. This may drive down home prices further. As a result, buyers will have improved affordability along with low mortgage rates.

Here are some tips for you to sustain in Mississippi’s housing market:

• If You Are a Home Buyer: With an inventory of 8K properties and the potential for further price drops, now is a good time to buy your new home. The low interest rates at 6.50%-6.90% are also in your favor. Consider negotiating for seller concessions to further benefit from the purchase.
• If You Are a Home Seller: The correction in the home prices is long overdue. In the wake of the NAR settlement, home prices may drop a little more. If you’re a seller, you can still make profits on home sale before prices potentially drop.

So, How Is the Real Estate Market in Mississippi?

Balanced!

The number of homes for sale increased by 18.6% in June 2024 compared to the previous year. This is the 2nd consecutive year the housing market has witnessed such growth. Single-family homes for sale are up by 17.0%, and condos by 21.6%.

• Median Days on Market: The median days on market for homes for sale is 38 days, up by 9 days YoY. This trend suggests a cooling demand in the Mississippi real estate market.
• Housing Inventory and Supply: As a buyer, you have more options now as the housing inventory is up by 18.6%. There are 8K homes for sale in Mississippi, with an average supply of 3 months.
• Average Home Prices: The median home price in Mississippi is $262,900. But, it is expected to decrease due to a rise in inventory in the latter half of 2024. The sale-to-list price ratio is 97.40%, increasing by 0.8 pt YoY.
• Home Sales: As per June 2024 data, home sales decreased by 14% YoY! Only 32,836 homes were sold, compared to 38,399 last year.
• Average Rent Prices: Rental costs vary statewide. An average tenant in Diamondhead pays $1,499, while the one living in Madison pays $2,472. You should check the local rates in your region.

Why Is Mississippi a Buyer’s Market Now?

Buyers have more options to explore. Additional housing supply can balance the Mississippi real estate market and stabilize home prices. Let’s look at some more facts:

• More Days on the Market: Number of days on market for homes is 38 and it’s increasing by 7 days YoY. This is visible in Madison city where homes have seen a huge increase of 29 YoY in days on the market.
• Low Housing Demand: The demand in Jackson city is low, with only 110 homes sold in June, down from 129 in last year. Similarly, only 72 homes were sold in Southaven, a significant 20% decrease from the previous year.
• More Homes Have Price Drops: In June, 30.9% of homes experienced price drops, compared to 26% last year. This trend indicates a gradual shift toward a buyer’s market.
• Low Mortgage Rates: Mortgage rates remain near historic lows, ranging between 6.50%-6.84%. So, this is a great time to lock in a low rate and get pre-approved for a mortgage now.

Mississippi Real Estate Market Predictions

Here are the predictions for Mississippi’s housing market in the remaining months of 2024 and 2025:

1. Number of Home Buyers Will Increase: As inventory grows and homes stay on the market, more home shoppers are expected to re-enter the market.
2. Interest Rates are Expected to Drop: Mortgage rates hit 6.30% in August 2024. NAR predicts the average interest rate will drop more by year-end. This will encourage more buyers to apply for loans.
3. Home Prices May Fall: After a period of sluggish growth, drop in home prices is expected. The increased affordability will attract more investors.
4. iBuyers Will Continue to Make Lowball Offers: iBuyers like Opendoor and Offerpad, which once offered 104.1% of market value in 2021, now offer around 70%. Such lowball offers to sellers will increase opportunities for individual buyers.

Bonus Predictions: Buyer Broker Commissions Will Be Zero!

In a shocking turn of events, the NAR settlement has completely eliminated buyer agent fees from the MLS. Let’s understand its impact:

1. Buyer Agents Will Be Affected: With buyers now responsible for directly paying their agents, many may choose to find their homes on their own. This may very soon render buyer agents obsolete.
2. Seller Concession Will Increase: Without the obligation to pay buyer agent commissions, sellers might see increased requests for seller concessions and offline transactions. Additionally, builders are offering significant concessions to attract buyers, further influencing the market dynamics.
3. Builders Will Compete More: Home builders are persuading buyers to buy new construction homes with mortgage buydowns worth $30K!
4. Sellers May Offer Fees for Services: Sellers may offer at least 1%-2% fees to the buyer agents in order to sell their homes quickly. Increasing competition from builders may also cause sellers to pay extra fees to buyer agents.

Is the Housing Market in Mississippi Going to Crash?

A housing market crash in Mississippi is unlikely. Mississippi’s housing market is known for its affordability. The median sale price of $262,000 is way lower than the national average.

Cities like Lynchburg and Jackson are very competitive. Homes in Lynchburg sell in 20 days. The city scores 75 in Redfin Compete Score which means it’s very competitive. Many homes get multiple offers and stay on the market only for 20 days.

Jackson city see an interesting trend of migration. People are moving to Jackson from larger cities such as Chicago, LA, and Dallas.

Job market remains robust, with an unemployment rate of just 2.7%. Additionally, the average cost of living in Mississippi is 13% lower than the national average. This affordability makes a housing market crash in Mississippi unlikely.

2024: Is It a Buyers’ or Sellers’ Market Now?

The housing market is expected to lean more in favor of the buyers in the latter half of 2024. Home prices are going to drop, and the number of homes for sale has increased by 18.6% YoY. Buyers now have more choices.

With mortgage rates around 6.30%, buyers also have more purchasing power. Consequently, more homeowners are likely to list their homes on Mississippi MLS.

So, whether you are looking for a condo in Jackson or a single-family primary home in Lynchburg, you will find your dream home in the coming months.

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Disclaimer: This article is for informational purposes only. It does not constitute an offer, solicitation of an offer, or any advice or recommendation. Houzeo doesn’t provide any legal or financial advice. The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Houzeo Corp., its affiliates, or its employees. However, the author does not make any representation or warranty, express or implied, as to the information’s accuracy or completeness, nor does the author recommend that the attached information serve as the basis of any investment decision.

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