Voices

Everything Was Up In 2024 — But Home Sales Only Slightly

April 22, 2025

Brian Toohey

There were a lot of high hopes for the 2024 real estate market. Many housing economists predicted a strong rebound in sales and a substantial drop in mortgage rates, which has been predicted for the past three years. Unfortunately, mortgage rates for a 30-year fixed rate mortgage (FRM) remained around 7 percent most of last year, with a brief stint in the low 6 percent range a month before the election (conspiracy theorist unite), just before going straight back up to 7 percent or more.

Locally, in Boone County, the housing market in 2024 had a mediocre year as the housing market continued to adjust after the COVID-19 years.

Single-family home sales in Boone County started the year on an upswing, with sales up 10 percent through May, a decent almost first half of the year, as sales for the same period in 2023 were down 21 percent from 2022. However, mortgage rates climbed, pushing home sales down most of the summer as the 10 percent gain in sales slowly evaporated, heading into the fall.

Mortgage rates in early fall were at the lowest point of 2024, and home sales, especially in the upper-end market segments, rebounded as buyers took advantage of low 6 percent mortgage rates. The drop in mortgage rates was enough to fuel buyers to help eke out a sales gain of 1.3 percent over 2023, but sales in the city of Columbia were down less than 1 percent — much less than was hoped for, and 38 percent below the past 10-year average.

Home sale prices in the past few years have been an unusual phenomenon. One would think that if sales are down compared to the 10-year average, then prices should also be down. However, that’s not the case.

Columbia and Boone County are experiencing some of the highest home appreciation in the country. The average price of a single-family home in Boone County during 2024 increased 8 percent to $372,329, while the median price jumped 7 percent to $325,000. Prices in the city limits of Columbia are slightly higher, with the average price up 9 percent to $384,796 and the median price also increased 9 percent to $340,000.

The biggest crux of the housing market has been market inventory, which is measured in the number of months based on the number of homes on the market on the last day of the month and the number of sales. Home inventory on the market has declined since 2017, but the drop has accelerated dramatically since 2019 because fewer people are willing to sell their homes.

Many people are rate-locked, meaning they have such a low mortgage rate they don’t want to move and face the possibility of a new mortgage rate that is double their current rate. Other people are worried about the capital gain tax consequences of selling their homes due to recent jumps in home values. A lack of market inventory frustrates buyers as it reduces their buying options. The average amount of home inventory has been steadily increasing since 2021, but for 2024, the average months of inventory declined by 9 percent to an average of two months for the year.

The housing market for 2024 turned out to be a mediocre year. A more significant jump in sales would have benefited buyers and sellers, but home prices still appreciated regardless of the lack of sales, but at a higher rate than preferred.

With the new presidential administration, there are many questions about how potential tax law changes, mortgage rates, and economic policy will affect the 2025 housing market. Hopefully, Boone County will see an increase in sales and home inventory while price appreciation settles back to the 2 percent to 5 percent range for the year.