Are people still spending money on home improvements despite rising housing costs and inflation? According to Opendoor’s 2024 Home Decor Report, the answer is yes. In fact, the average American will spend $5,635 on home remodeling projects this year.
We reviewed Opendoor’s data and spoke with a design expert to get insights on this year’s home decor and renovation trends. When it comes to how homebuyers (and renters) are prioritizing their spending, we learned that paint makes a difference, kitchens renovations are top of the to-do list, and new or repurposed decor can liven up a space. Beyond that, here are some of the most popular home upgrades American homeowners want to try ASAP.
About the Survey
Opendoor surveyed 1,041 homeowners ages 25-74 who have decorated or remodeled in the past two years or have shown interest in doing so.
Popular Home Renovations
When asked about their top-priority remodeling project, 33 percent of respondents said painting, and another 27 percent said the kitchen. Here are some other important upgrades Americans want to make in their homes.
Updating Light Fixtures
For a relatively easy home renovation that may or may not require a handyman, 25 percent of homeowners want to update light fixtures before anything else. The scale and design of overhead lighting can make a significant impact on the look and feel of a space.
Installing New Flooring
Updating floors is the most important home renovation for 24 percent of homeowners. While the cost and labor can be significant, a fresh wood floor or carpet can make a space feel brand new. However, if the scale of this project is too much for the moment, consider a new area rug or a different paint color to offset dated flooring.
Upgrading Kitchen Cabinets
Of all the kitchen renovation projects, 22 percent of homeowners say they want to (or have already) installed new kitchen cabinets. Trendy kitchen cabinet styles come and go, but for longevity, consider a style that coordinates with your home style. For example, shaker-style cabinets look great in older Craftsman homes, while slab-style cabinets work well in homes from the mid-century. If new cabinets aren’t in the budget, consider repainting them to give them a fresh, new look.
Replacing Kitchen Counters
Kitchen counters are the most important project for another 22 percent of homeowners. It’s an upgrade you can do on its own or with a full-scale kitchen renovation. While granite and quartz are popular among homeowners, home design expert Dabito prefers marble. “I think Calacatta marble is making a big splash in the kitchen. It has a lot of bold, unique veins that can add movement and texture in a kitchen space,” he says.
Dabito is an interior designer, color expert, and creative director at Old Brand New.
Affordable Projects
Not all home renovation projects need to break the bank. In some cases, they don’t even involve demolishing a space. Here’s how homeowners plan to save money when updating their homes.
Painting a Room
Painting a room was the highest priority home renovation listed in the survey, but it was also chosen as the most affordable. According to Opendoor’s 2024 Home Decor Report, the top home colors are (in order of popularity):
Off-white
Light gray
Beige
So we can expect these to show up quite a bit in renovation projects next year. “These colors can provide a sense of calm for those living in (and visiting) a home. Traditional neutrals offer a blank slate for home shoppers to easily envision their style,” Dabito says.
“That said, I’m big on color, so I anticipate that the ‘new’ neutrals will be muted tones that are grounded and offer stability—think light blue, light green, dusty rose, and eggshell yellow,” he explains. Dabito also suggests that many paint color brands’ 2024 Colors of the Year are in line with that assumption, with many choosing subdued blues and greens as emerging shades. “These colors can add warmth to a space without overwhelming the senses,” he says.
Buying Seasonal Decor
Updating your seasonal decor is the most affordable to update your home, according to 55 percent of homeowners. But does this count as a home renovation? Sure, if you consider that a renovation can include any project that improves a home, whether that be cosmetic, structural, or a decor change that improves the visual appeal of a space. (Think of how effective home staging is when you sell your home.) Try swapping out fabrics throughout your home from cotton and linen in the warmer months to velvet and wool in the winter.
Changing Furniture
Some house projects won’t require spending at all. Changing the layout of your furniture was chosen as the best wallet-friendly update by 49 percent of homeowners. And Dabito is a fan of using what you have to make a big change.
“Changing furniture is a great way to make a space feel new—without having to change a home’s structure or layout,” he says. “One of my favorite tips is to use furniture as a divider. Try moving your sofa, so it becomes the separator between a living area and the kitchen, for instance. Or, you can have your furniture float in the middle of the room rather than against a wall.”
Dabito
Flow in any space is important, so reimagine your bedroom or living room in a new layout that might offer a better flow. I also love round coffee tables for smaller living spaces because they’re more inviting.
—Dabito
Eco-Friendly Upgrades
Sustainable projects can save money, so these home renovation trends are excellent for your wallet and the earth. Here’s how homeowners take care of their environment while upgrading their homes.
Refinishing Existing Materials
Just because your furniture and decor seem dated doesn’t mean you need to toss it. Homeowners agree that refinishing existing materials is a conscious way to update your home without adding to the landfill.
“One of my favorite ways to refinish existing materials is to let the natural beauty of an existing piece shine through, says Dabito. “Peel-and-stick tiles are fantastic for any outdated tilework in a kitchen without having to commit to a full-on renovation.”
Investing in Dimmers
Installing dimmers is a relatively easy DIY project that improves energy savings. Also, dimmers can enhance your quality of life by providing a range of brightness throughout the day. Just remember to turn the lights off completely when you leave the room for maximum energy conservation.
Refinishing Old Furniture
Just like refinishing materials in your home, you can also give your old furniture an upgrade. Staining or painting wood furniture is a beginner-friendly project and will make use of materials that would have otherwise been tossed.
“Staining a wood furnishing like a side table or cabinet is a great way to make its natural qualities stand out while making it feel new. On the flip side, I also love reimagining an old piece with a fresh coat of paint,” Dabito says.
Bond traders were not ready for this, and the 10-year yield shot up higher, along with mortgage rates. As of this second, we are three basis points above my peak 2024 yield forecast call of 4.25%.
I have been tracking data for a long time and have never seen a divergence in the report like I see today. We all know the shelter rent lag in the data, but this is different — this is a straightforward one-month adjustment issue as the breakaway from OER is massive compared to the Rent of Primary Residence in the U.S. city average.
On Monday’s HousingWire Daily podcast I asked the question of which we will see first: 8% mortgage rates or 6% mortgage rates? I firmly believe that the Fed hasn’t pivoted. I believe the Fed has a COVID-19 housing economic policy to ensure that housing stays depressed because of the fear of a return to the 1970s, which had a housing boom, for those who don’t remember.
From the CPI report: The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.3 percent in January on a seasonally adjusted basis, after rising 0.2 percent in December, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all-items index increased 3.1 percent before seasonal adjustment.
Of course, the Federal Reserve focuses on core inflation, and even with the inflated shelter index, we have made a good progress on core Inflation year-over-year.
Even the shelter inflation index — the biggest driver of core Inflation as it is 44% of the CPI index — is slowly heading in the right direction. I believe everyone understands that this CPI report looks a bit fishy, but bond traders don’t care; they were not prepared for this, so they sell first and send yields and mortgage rates higher. The question is: Does the Fed know enough to see what is wrong in this report? That is a good question.
On a year-over-year basis, the OER inflation data is making progress, but it’s lagging the reality of the current data. Mind that when I talk about rent disinflation, the big push is apartments. Single-family rents are stabilizing and holding up well. However, apartments are having pricing issues, meaning more supply is coming online, which will halt production of many more apartments until the supply and demand equilibrium can stabilize to where it makes sense to spend money to build more apartments.
What does this mean for mortgage rates? Well, they’re going up today, and if bond traders feel the itch to start shorting the bond market again and push yields higher as they did last year, this again puts more pressure on the housing market, which is already in the third year of great recession lows in demand.
The one thing that is positive now is that when the 10-year yield headed toward 5% and mortgage rates were at 8%, the Fed called this a very restrictive policy, meaning that it wasn’t their intent to have yields this high. Now that PCE inflation is running below 2% on the three and six-month data pool, we shall see if they hold to that view since inflation is much lower in 2024 than in 2023.
However, as you can see, I don’t like playing with fire when you don’t need to risk being burned. Since the Fed hasn’t pivoted, they’re playing with fire when they don’t need to. I may be one of the last people on the planet who believes the Fed hasn’t pivoted, but today shows why I have taken that view.
Again, the progress in inflation is here, but as I have believed for a long time, the labor market is the key to mortgage rates, bond yields and the Fed’s actions. If jobless claims were running at 300,000, today’s data wouldn’t matter and the 10-year yield would have already been lower. Remember, when it comes to rock, paper, scissors, labor always beats inflation, and it’s all about jobless claims data.
Mortgage rates continued their downward trajectory at the start of 2024, incentivizing homebuyers to apply for loans. Meanwhile, an easing of the inventory shortage foreshadows the possible return of a stable housing market.
Lock volume increased by 36% between December and January, driven by a 38% seasonal increase in purchase lock volume, according to Optimal Blue’s Originations Market Monitor report. Cash-out and rate-and-term refinance volumes rose 30% and 20%, respectively.
Brennan O’Connell, director of data solutions at Optimal Blue, also noted that January’s year-over-year decline in purchase lock counts, which exclude the impact of changes in home prices, was the lowest seen since May 2022.
The spread between the 10-year Treasury yield and mortgage rates narrowed to 250 basis points in January, 19 basis points less than a month earlier.
The Optimal Blue Mortgage Market Indices’ 30-year conforming rate dropped 4 basis points in January to reach 6.53%. Meanwhile, rates for Federal Housing Administration (FHA) and U.S. Department of Veteran Affairs (VA) loans also fell in January, while jumbo rates moved up.
Overall, conforming products gained market share in January, accounting for 57.3% of total volume. Nonconforming products also rose to comprise 9.7% of the total volume. These include jumbo and nonqualified mortgage (non-QM) loans.
Government-backed loan products posted a setback in market shares in January, with the FHA share dropping to 20.7% and the VA share dropping to 11.7% of total volume. An improving rate environment and an inverted yield curve put a cap on the demand for adjustable-rate mortgages (ARMs) as their market share stayed consistent at slightly more than 5% of total volume.
Each of the top 20 metropolitan statistical areas by share of origination volume experienced monthly increases in rate lock volume. Notably, Las Vegas posted a 90.8% increase in lock volume from December to January.
The average loan amount rose from $349,500 in December to $355,600 in January. And the average home purchase price increased from $435,900 to $444,900 after six straight months of declines.
So far in 2024, fewer homes are taking price cuts than in 2023, and this trend is on the verge of breaking below the 2023 lows in price cuts percentages. While weekly inventory is still falling, we have year-over-year growth in total active listing and new listings data. This calls into question a mortgage rate lockdown, as mortgage rates are also higher year over year.
What is all this data pointing to? We might have an average year in housing compared to the past four years! So, we need to be very mindful of the weekly data to get clues on the marketplace.
Price-cut percentage
Every year, one-third of all homes take a price cut before selling — this is a traditional housing activity. However, this data can move stronger in either direction when mortgage rates rise or fall aggressively.
A perfect example was in 2022: when housing inventory rose faster as demand crashed, the percentage of price cuts rose faster. After November of 2022, home sales stopped crashing and the price-cut percentage data has stabilized. Even when mortgage rates were approaching 8% last year, the number of homes taking price cuts was always 4% below the 2022 level. Currently, the price-cut percentage is less than 1% from breaking below the lows set in 2023. Demand is rising from a low bar, and total housing inventory levels are still historically low. This is the price-cut percentage for last week over the last few years:
2024: 30.1%
2023: 32.2%
2022: 18.3 %
Weekly housing inventory data
A really positive story for 2024 is that we have higher housing inventory year over year. It isn’t anything to write home about, but it’s a positive story nonetheless. I am a very pro-housing supply person and will feel much better about the housing market when we return to pre-COVID-19 levels for total active listings. Last week, inventory fell week to week but was up over this time last year. I am still hoping we get the seasonal bottom in inventory in February and not March or April.
Here is a look at last week:
Weekly inventory change (Feb. 2-9): Inventory fell from 497,389 to 494,862
Same week last year (Feb. 3-10): Inventory fell from 457,717 to 444,129
The recent inventory bottom was in 2022 at 240,194
The inventory peak for 2023 was 569,898
For context, active listings for this week in 2015 were 947,864
New listings data
The new listing data put a big smile on my face this week! For the first time in a while, this was a good week for new listing data. Over the last few years, we have been trending at the lowest levels ever, so seeing a positive week is great. Also, this brings into question the mortgage rate lockdown premise since mortgage rates are higher yearly. This is something I have been discussing for many months on CNBC.
Weekly new listing data for last week over the last several years:
2024: 51,875
2023: 44,533
2022: 45,594
Mortgage rates and the 10-year yield
The 10-year yield is the key for housing in 2024. In my 2024 forecast, I put the 10-year yield range between 3.21%-4.25%, with a critical line in the sand at 3.37%. If the economic data stays firm, we shouldn’t break below 3.21%, but if the labor data gets weaker, that line in the sand — which I call the Gandalf line, as in “you shall not pass” — will be tested.
This 10-year yield range translates to mortgage rates between 5.75%-7.25%, but this assumes spreads are still bad. The spreads have been improving this year so much that if we hit 4.25% on the 10-year yield, we still won’t see 7.25% in mortgage rates.
Last week was very interesting because we had a few Fed events to deal with. First there was the aftermath of Jay Powell’s 60 Minutes interview. Then the president of the Minneapolis Fed, Neel Kashkari, made statements about how the Federal Reserve policy isn’t as tight as people would believe, presenting his case in this article. However, just a few days later, Kashkari talked about how his gut tells him that two to three rate cuts are indeed in play. I discussed this turn of events with Editor in Chief Sarah Wheeler on the HousingWire Daily podcast.
The 10-year yield closed at the week high on Friday, even though the highly anticipated CPI revisions data showed that the inflation slowdown was accurate and no upward revisions were made.
Mortgage rates didn’t move around too much last week, ranging between 7.04% and 6.95%. However, as we can see, even with significant progress on the growth rate of inflation slowing down, mortgage rates are near 7% and the 10-year yield is still over 4%. My point on this topic has been clear for a while: the Fed hasn’t pivoted, and they have a highly restrictive policy against housing as they still believe in their COVID-19 housing policy keeping home sales trending near all-time lows.
Purchase application data
Last week, we had some confusion on purchase apps, as the unadjusted numbers showed 6% week-to-week growth. We don’t account for that data line ever; the actual numbers showed -1% week-to-week growth, and we are still showing negative 19% year-over-year data. Last year, we had better positive data as mortgage rates headed down toward 6% before rates started higher, so the year-over-year comps will get easier. However, if we had strong housing demand, purchase application data would easily be positive year over year and by double digits as well. For now, just think of a bounce from record lows in demand.
The year-to-date count is two positive reports and two negative purchase application reports. Since mortgage rates started to fall in November of 2023, we have had eight positive and two negative weeks after making some holiday adjustments. This has the potential to take the seasonal inventory bottom to March. However, I am hoping for the bottom in February.
The week ahead: It’s inflation week, plus retail sales and housing starts
We have a lot of data coming up: two inflation reports, retail sales, the builder’s confidence index and housing starts. The CPI inflation data will be exciting over the next six to seven months because we can start to see the rent factor kicking into higher gear to the downside. Even though the Fed says they don’t account for shelter when talking about rate cuts, lower inflation will bring more and more pressure on them to pivot and bring rates down. We will have tons of data lines to work from next week.
On a day where 10yr Treasury yields bounced multiple times at the 4.19% technical level, and considering the recent relevance of that particular level, we might expect to find that the intraday trading story was interesting or exciting. This could possibly be argued for the early morning trading surrounding the release of CPI seasonal revisions, but that played out in a matter of minutes and had nothing to do with 4.19%. The rest of the day was spent grinding sideways just under that ceiling. MBS did slightly better than Treasuries due to the monthly UMBS 30yr settlement process (not a reliable pro or con, but a pro this time around).
Jobless Claims
218k vs 220k f’cast, 227k prev
10:07 AM
Volatility after CPI revisions, but actual selling around 9:20-9:30am ET. Holding ground under the 4.19% ceiling, currently up 1.9bps at 4.177. MBS are down 3 ticks (.09).
01:15 PM
Off the weakest levels now. MBS down only 3 ticks (.09). 10yr up 2.3bps at 4.181.
03:25 PM
Slowly grinding toward less red levels. MBS down only 2 ticks (.06) and 10yr up 1.9bps at 4.177.
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It’s no secret that 2023 was a difficult year to buy a home. With mortgage rates briefly topping 8% and home prices breaking records throughout the year, many would-be sellers simply decided not to bother listing their homes, exacerbating already tight inventories.
New data from the U.S. Census Bureau published last week shows how drastically housing inventory has changed since 2020, while weekly data from Altos Research offers some insights on where it goes from here.
Census Bureau data on housing inventory estimates details two cycles this decade – the onset of the pandemic and the rise of interest rates – that have been catastrophic for the nation’s for-sale housing inventory.
2020-2021: The shock to the system
The onset of the pandemic and government lockdowns sparked a frenzy for homes, especially those away from crowded downtowns and with ample space for home offices and homeschooling. Prospective homebuyers were armed with low interest rates, paused student loan payments and stimulus checks.
The number of owner-occupied homes skyrocketed, quickly depleting the number of vacant for-sale homes. Renters occupied fewer homes, and fewer vacant homes were reserved for them.
The number of homes “held off market” – second homes, vacation homes and others that are neither for-sale, for-rent or occupied – shrank. This could be because their owners snagged profits amid rapidly rising prices, because those who can afford second homes paused buying, or a combination of the two.
Seasonal housing, too, dropped considerably. This is likely due to the fact that seasonal housing – defined as homes intended for periodic occupancy such as for holiday resort guests or farm workers – could be profitably sold to meet soaring homebuyer demand and was not needed during the pandemic’s travel restrictions and weak travel demand.
Most of the trends begun in 2020 continued in 2021 except for renter-occupied homes, which rose above 2019 levels in the second half of the year. This was likely a reflection of the prolonged decline in vacant homes for sale, which made it difficult for would-be buyers to find a home to purchase.
Many of the same pandemic forces that set off the homebuying frenzy also fueled a frenetic pace of inflation. In 2022, the Federal Reserve began taking action to combat these market forces by raising interest rates, starting the second cycle of inventory changes.
2022-2023: The high-rate environment
Over two years, the Federal Reserve hiked rates 11 times for a total increase of 5.25 percentage points, the fastest pace of hikes in four decades. It has held rates at an effective rate of 5.33% in every meeting of the Federal Reserve Open Markets Committee since July 2023, including in their meeting last week.
Mortgage rates followed suit, walloping buyers’ purchasing power. The sudden run-up in rates discouraged would-be sellers from listing their homes, as they would be faced with much higher monthly payments for the same size home were they to sell and buy another home – if they even qualified for the same size home as they currently own.
This squeezed inventory even further throughout 2022 and 2023, pushing home prices to record highs month after month.
The high-rate environment further pushed owner occupancy up while pushing homes held off market, seasonal housing and homes vacant for sale down. That the number of owner-occupied homes rose throughout 2023 – an abysmal year for home sales – shows just how tightly recent homebuyers are holding onto their low rates.
High rates, combined with low for-sale inventories and high home prices, have also resulted in a surge in home renters. There were nearly 2 million more renter-occupied homes in the fourth quarter of 2023 than in the same quarter of 2019.
The environment has also prompted many homeowners to list their homes for rent rather than sale. The number of homes vacant for rent in the fourth quarter of 2023 was up 4% since the same quarter five years ago, while the number of homes vacant for sale was down 36%.
When inventory bounces back
The extremes of the 2020s have dealt big blows to for-sale inventories. First the 2020-2021 housing frenzy took a big bite out of existing inventories, then the 2022-2023 streak of rate hikes kept would-be sellers from replenishing those inventories.
The 2020s have also seen for-sale inventory siphoned from second homes, vacation homes and seasonal homes. Homebuilders, too, have added to for-sale inventory, pushing the total number of homes in the U.S. up 8.7% since the fourth quarter of 2018. But none of these valves have alleviated the shortage of for-sale homes or the resultant high home prices.
The majority of homes that would be up for sale are being held by owners with low mortgage rates who would rather stay put or rent than sell, a phenomenon known as the “mortgage rate lockdown.” Plus, boomers are aging in place for longer, further depleting available housing stock. In fact, the number of owner-occupied homes is at an all-time high, while the percentage of homes that are owner-occupied is well above pre-pandemic levels.
The only apparent change that could induce significant for-sale inventory back into the market, then, is lower mortgage rates. How quickly would sellers return if rates were lower? We got an early test in December and January when the FOMC forecasted rate cuts in 2024.
As rates began falling steeply from October through December and hovered around 6.6% in January, new listings increased on a year-to-year basis in 14 of 15 weeks, according to data from Altos Research, which, like HousingWire, is owned by HW Media.
The data is an encouraging sign that owners with homes to sell will be responsive to mortgage rates, suggesting rate cuts this year could bring about a rapid uptick in homes for sale.
Less encouraging, however, is how soon the market might see rate cuts. Mortgage rates rose above 7% this week for the first time in 2024 following a strong jobs report and comments by Federal Reserve Chairman Jerome Powell that suggested cuts were less imminent than many bond and equity traders had assumed.
One substantial positive story for 2024 is that we have more housing inventory year over year. It’s not a lot, but anything is positive, which I will take. I am a very pro-housing supply person and will feel much better about the housing market when we return to pre-COVID-19 levels for total active listings. However, last week, inventory fell week to week but was up year over year.
Here is a look at last week:
Weekly inventory change (Jan. 19-26): Inventory fell from 503,233 to 497,389
Same week last year (Jan. 20-27): Inventory fell from 466,391 to 457,717
The inventory bottom for 2022 was 240,194
The inventory peak for 2023 is 569,898
For context, active listings for this week in 2015 were 936,253
New listings data
I have been hoping for more new listings data growth in 2024 and even though we’re positive year over year, it’s just not as much as I would like. But at least it’s positive! New listings were trending at the lowest levels ever in 2023, but that should not be the case in 2024. Never forget most sellers are buyers of homes as well, especially if the economy isn’t in a job loss recession. This is a topic I recently discussed on CNBC.
Weekly new listing data for last week over the last several years:
2024: 44,167
2023: 40,767
2022: 40,370
Price cut percentage
Every year, one-third of all homes take a price cut before selling — this is very traditional housing activity. However, when mortgage rates rise and demand gets hit, the price cut percentage data grows year over year.
A perfect example was in 2022: when housing inventory rose faster as demand crashed, the percentage of price cuts rose faster. That increase matched the slope of the inventory increase, and people needed to cut prices to sell their homes. Existing home sales stopped crashing after November of 2022 and this data line has stabilized. As long as this trend continues, we will go below the price cut percentage in 2023 in the spring of this year.
This is the price-cut percentage for the same week over the last few years:
2024: 30.6%
2023: 33%
2022: 19.2 %
Mortgage rates and the 10-year yield
The 10-year yield is the key for housing in 2024. In my 2024 forecast, I have the 10-year yield range between 3.21%-4.25%, with a critical line in the sand at 3.37%. If the economic data stays firm, we shouldn’t break below 3.21%, but if the labor data gets weaker, that line in the sand — which I call the Gandalf line, as in “you shall not pass” — will be tested.
This 10-year yield range means mortgage rates between 5.75%-7.25%, but this assumes spreads are still bad. The spreads have been improving this year so much that if we hit 4.25% on the 10-year yield, we won’t see 7.25% in mortgage rates.
It was a crazy week for the 10-year yield and mortgage rates as it was jobs week and the Federal Reserve held its Federal Open Markets Committee (FOMC) meeting. The 10-year yield started at 4.13%, got as low as 3.81%, and ended the week at 4.02%. Mortgage rates started the week at 6.88%, fell to a low of 6.63%, then shot up to 6.92% on jobs Friday as the labor data came in stronger than anticipated and the 10-year yield spiked higher with mortgage rates, as you can see in the chart below. I also wrote about the jobs report in this article.
I have always stressed that the labor data is more critical for mortgage rates than the inflation growth rate at this stage. The growth rate of inflation is slowing down noticeably. PCE inflation data is running below 2% on the three- and six-month data line trends, but the 10-year yield is still over 4% and we are near 7% mortgage rates. If jobless claims data ran over 323,000 on the four-week moving average, that would be a different story, as the 10-year yield would be much lower.
Purchase application data
Last week was the first negative week in the purchase application data report since rates fell, as we saw a decline of 11% weekly and they were down 20% year over year. Rates had been ticking up a bit higher, but before last week, it didn’t impact the data much. Eight out of the last nine weeks that I have counted (after making some holiday adjustments) are positive, and for 2024, we have two positive prints versus one negative print.
We always want to weigh this index after the second week of January to the first week of May: After May, total volumes traditionally always fall. Much like 2022-203 data, we have a bounce in demand as mortgage rates have fallen. The question is: how will the rest of the heat months act? Last year, rates spiked up higher and then headed toward 8%. This year should be a different story unless the Fed messes it up.
The week ahead
After a crazy week of labor data and remarks by Fed Chair Jerome Powell, we should have a calmer week with some manufacturing data, household credit data and the all-important jobless claims data.
I will be very interested to see how the 10-year yield trades, especially after Powell talks on 60 Minutes Sunday night — that has the potential to be a market mover. Remember, to their credit, the Federal Reserve used the term restrictive policy when the 10-year yield broke over 4.25% and headed toward 5%. Talk is cheap, and I will need to see some action before they want lower yields to ensure they focus on their dual mandate by keeping prices stable and employment high.
Inside: Understanding the meaning of 4 figures of money can help you to evaluate your yearly income and expenses as well as potential jobs or side hustles.
The term “four figures” often pops up in financial discussions, but it can be a source of confusion for those not well-versed in financial jargon.
Grasping the concept of what four figures entail is significant for a variety of reasons. It can influence budgeting decisions, salary negotiations, and long-term financial planning.
Whether considering the affordability of an expense, the significance of a salary, or the value of savings, understanding the range of four figures helps set realistic expectations and enables better financial management.
Quick Answer
“Four figures” simply refers to a numerical amount that falls within the range of 1,000 to 9,999—representing a sum that has four numeric digits.
How Much is 4 Figures
In essence, when discussing finances, whether planning a budget, evaluating jobs, or making investments, the term “figures” frequently enters the conversation, referring to the number of digits in a sum of money.
Specifically, “four figures” denotes dollar amounts that range from $1,000 to $9,999. This is a classification that falls between three figures (in the hundreds) and five figures (in the tens of thousands).
Low 4 Figures
A low 4-figure income represents the bottom third of the four-figure income bracket, ranging from $1,000 to $3,333.
Many of our popular mini savings challenges fall into this range.
Mid 4 Figures
A mid four-figure income, falling within the middle one-third of the range, would typically be defined as between approximately $3,334 – 6,666.
For most people paid a monthly salary, this is the range of the paycheck when earning $60000 a year.
High 4 Figures
A high four-figure income is in the higher one-third of its range, which falls between approximately $6,667 and 9,999.
Earning within this bracket places an individual or household near the upper limit of what’s considered a high four-figure income, before transitioning into six figure salaries.
Why Striving for a Four Figure Salary Matters
A 4-figure salary refers to an income that is in the range of $1,000 to $9,999. At first glance, this might not seem like a substantial amount, especially when compared to the more commonly sought-after 5 or 6-figure salaries.
Yet, it’s important to recognize that a 4-figure income can play a significant role in various economic scenarios and for different groups of people.
Next, we are going to discuss how often you earn a 4 figure salary, which will make the difference overall.
How Much Is 4 Figures a Year?
When we talk about a 4-figure salary in the context of annual income, we’re referring to an amount ranging from $1,000 to $9,999 per year. This level of yearly income is generally considered quite low, particularly in developed countries like the US or UK, where living expenses can be high.
For single-person households, this sort of income falls below the poverty guideline set by the US federal government, which was $14,580 for the year 2023. 1
Using the context of four figures in a year is better for discussing expenses like the cost of vacation, taxes, or maybe groceries.
How Much Is 4 Figures a Month?
A monthly income that falls into the 4-figure category would amount to anywhere between $1,000 and $9,999. This span covers a broad spectrum of possible earning scenarios, from just reaching minimum wage to approaching an upper-middle-class income bracket in many locations.
Someone earning $1,000 per month is at the very bottom end of this range. In countries with higher living costs, such as the United States, this income level would likely be insufficient to live on without additional support, savings, or aid.
As we move toward the middle of the range, an individual making, say, $5000 per month would have a substantial increase in their standard of living. However, you need an annual sum of closer to $75,000 a year to be near the median household income level in the U.S.2
Towards the upper end, a monthly four-figure income of $9,999 translates to nearly $120,000 a year. This would be considered a strong income in most parts of the U.S. and could afford a very comfortable lifestyle with potential for savings, investments, and discretionary spending.
When you look at fixed expenses, only a mortgage should be costing you four figures a month.
How Much Is 4 Figures a Week?
Discussing a 4-figure income on a weekly basis means earning between $1,000 and $9,999 each week. Within this context, such a salary is fairly impressive, placing the individual well above the median wage for most workers.
The lower limit of this range is $1,000 weekly, which annually equates to $52000 a year.
At the midpoint of the 4-figure scale, an individual bringing home $5,000 weekly would earn $260,000 annually.
Once you crest into the higher part of the 4-figure range, for instance, earning $9,999 weekly, the annual income becomes quite substantial – approaching half a million dollars or $519,948 to be exact.
How Much Is 4 Figures a Day?
Earning a 4-figure sum daily ranges from $1,000 up to $9,999. This daily earning rate translates to a notably high income, typically found in the echelons of top industry professionals, successful entrepreneurs, stock traders, high-caliber consultants, and individuals with profitable investments or ownership in thriving businesses.
At the lower end, earning $1000 a day without breaks would accrue to an annual income of approximately $365,000. While this may not be the norm for most individuals, it is achievable for those with high-paying specialized careers and in-demand expertise.
Midway through the 4-figure daily earning spectrum, a salary of around $5,000 per day would lead to an annual income surpassing $1.825 million.
At the top end of a 4-figure daily income, earning nearly $9,999, one would accumulate close to $3.65 million a year.
Many of my fellow traders and I work on earning $10000 a day. Even if we reach that goal only 20 times per year. We can net $200,000.
Start with learning how to invest $100 to make $1000 a day and see where your financial success happens.
Strategies to Reach a 4-Figure Salary
Upgrading Skills and Qualifications
Upgrading skills and qualifications is crucial in a rapidly evolving job market; it enables professionals to remain competitive and relevant. Moreover, with higher qualifications, individuals often gain access to better job opportunities and can command higher salaries.
Also, enhancing one’s financial literacy and investing knowledge can lead to making more informed decisions that potentially expand one’s wealth. This help help you to become financially stable.
For example, my own journey in improving my investing acumen has improved my overall net worth as well as providing extra income on a monthly basis.
Exploring Part-Time and Side Hustle Opportunities
Whether it’s through seasonal work, remote opportunities, or local part-time positions, the right side hustle can serve as a reliable financial bolster and even progress to a lucrative career over time.
Thankfully, there are so many ways to make money online that you have plenty of options.
The key is finding something that you enjoy and making money with your passion.
Frequently Asked Questions
Earning a 4-figure salary signifies that an individual’s income ranges from $1,000 to $9,999—this could apply to weekly, monthly, or annual earnings. The term doesn’t pinpoint an exact number but instead establishes the income bracket.
A 4-figure salary is often considered a benchmark for part-time or entry-level jobs, temporary work, or side gigs. For some, this income might be supplementary, enhancing their overall household earnings. However, for others, this figure may represent the sole income, which is especially common in part-time roles or jobs in industries with lower average wages.
It’s also worth noting that while a 4-figure salary provides a broad view of one’s income, it doesn’t give insight into the specific living conditions or financial health of an individual. This is because the purchasing power of a 4-figure salary can vary widely depending upon geographical location, cost of living, personal debt, and individual lifestyle choices.
Furthermore, earning a 4-figure salary can have different implications based on frequency; for example, earning a 4-figure sum on a daily basis would indicate a high-earning individual, whereas annually, it could suggest that someone is earning below the poverty line in certain developed countries.
Living comfortably on a 4-figure salary depends heavily on several factors, including the specific amount within that range, how often you are paid, the location where one resides, individual financial obligations, and lifestyle choices.
Ultimately, while it’s possible to live on a 4-figure salary, it generally requires strict budgeting, financial discipline, and potentially additional sources of income for a more comfortable living standard.
Now, You know 4 Figures Meaning
What do you plan to do with this knowledge?
To enhance your financial situation, taking proactive and strategic measures is essential.
Start by negotiating a higher salary through meticulous research on industry standards and clear communication of your value to your employer, highlighting quantifiable successes and achievements.
Furthermore, diversify your income streams by exploring side hustles.
The choice is yours. You can walk away with this knowledge. Or start a side hustle that brings in over four figures consistently like me.
Source
HealthCare.gov. “Federal poverty level (FPL).” https://www.healthcare.gov/glossary/federal-poverty-level-fpl/. Accessed February 1, 2024.
Census.gov. “Income in the United States: 2022.” https://www.census.gov/library/publications/2023/demo/p60-279.html#:~:text=Highlights,and%20Table%20A%2D1). Accessed February 1, 2024.
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Louisville, like the nation, continues to see rising single-family home prices amid low inventory.
Rising interest rates in 2023 sidelined many potential homebuyers and provided little appetite to potential home sellers sitting on much lower interest rates.
Median home prices rose 3.6% last year in the greater Louisville area over 2022, according to the Greater Louisville Association of Realtors. New listings were down 10% and closed sales were down 15%.
“Brutal,” Mike Frank, a senior mortgage broker at Homestretch Mortgage in Louisville, said of 2023. “That was my worst year in the business last year. That’s because everybody was scared because the market turned so fast and rates were at 8%.”
it was likely done raising interest rates after more than a year of hikes meant to slow inflation. It also signaled three rate cuts could be coming in 2024.
Lowering this rate is expected to lead to lower mortgage rates, which hit a 23-year high in October 2023 at nearly 7.8%.
the typical down payment for first-time (8%) and repeat (19%) buyers, according to the National Association of Realtors), a 30-year mortgage with a 7% interest rate would mean monthly payments of about $1,600 (not including homeowner’s insurance or property taxes). Drop the interest rate to 6% and the payment falls to about $1,440.
“It going to get people off of the fence,” Frank said of potential home buyers. “I don’t think (the rates) are gonna go too much lower, but at least it’s gonna get people to go, ‘Ok, maybe this is the time.'”
More homes should hit the market and be sold. But will it balance the market?
Last year marked the worst year on record for home sales in the United States since 1995, according to the National Association of Realtors.
In the greater Louisville area, December 2023 marked the 24th consecutive month of year-over-year declines in existing home sales. Real estate agents compare months year-over-year instead of month-to-month because of seasonal trends in real estate.
Redfin. Nearly 60% have a rate below 4%.
“How do you convince those people that this is a great time to move?” he said.
He anticipates the more rates drop toward the rates that homeowners currently have, the more likely they’ll be to take the rising equity they have in their home and go shopping for a new one.
“If we can close the gap that we have between rates that homeowners got a few years ago versus current market rates, that could help push a few more homes into the market,” he said.
2024 will still be a seller’s market
An imbalance of buyers and available homes has made for a persistent seller’s market, a trend local real estate agents don’t see changing any time soon.
Those in the real estate industry consider three to six months of supply (how long it would take for the existing supply of homes on the market to sell at the current sales pace) to be a “balanced” market favorable to both buyers and sellers.
traced back to the Great Recession when many homebuilders went out of business and those that remained didn’t resume building at previous rates.
Even with a projected drop in interest rates, DeWalt said she’s not anticipating the frenzy of the 2020 and 2021 housing market that saw intense bidding wars and the waiving of contingencies, such as home inspections.
“I don’t see it being as crazy like that this coming year, even with more buyers coming on because of the interest rates,” she said. “They’re not gonna drop that low.”
national Realtors association, in a recent news release. “If price increases continue at the current pace, the country could accelerate into haves and have-nots.”
What does this mean for the real estate market in 2024?
Schuler said he anticipates 2024 will “be a more normal year of what real estate used to be like pre-pandemic,” with its most challenging aspect being expectation management for both buyers and sellers.
“From a home seller standpoint, they’ll need to understand … their property will not sell within three hours,” he said. “All they’ve heard for the past three to four years and all they’ve seen on social media and then the news are homes selling for above asking price, multiple offers, waiving any and every contingency. Whereas now that’s not the case.”
Buyers, meanwhile, may feel buoyed by news of interest rates dropping, but they’re still up against a challenging inventory issue.
“From a home buyer standpoint, they’re still gonna have to understand the fact that inventory levels continue to be historically low,” he said. “So if you have your list of everything you want and need in a home, you’re going to have to be understanding that you probably won’t get all of those items, and chances are you still will be paying 98% of the listing price.”
Even if rates fall, Schuler and Frank encouraged prospective home buyers to analyze their budget and focus on what a potential monthly payment would be.
“We instruct our clients that you live in your payment,” he said. “So try not to just focus so much on the price of the home or the rate. Let’s just look at the monthly payment. Can you comfortably live with this monthly payment? Yes or no?”
Different loan programs have varying parameters that will shape a monthly payment, Frank said, yet another consideration for people as they weigh entering the market.
“We would be naive to think that the rate doesn’t matter because it does,” Frank said. “But there are other factors that really come into play.”
Growth & development reporter Matthew Glowicki can be reached at [email protected], 502-582-4000 or on Twitter @mattglo.
The weather is nippy, the sun is low in the winter sky, and all thoughts are turning to comfort food. In other words, it’s officially the season to hunker down and gleefully embrace your homebody instincts to stay in.
If your household is anything like ours, these next few months will also be when the dining room becomes a place for more than just meals. Indeed, winter hibernation includes slow mornings over a book and long evenings with your latest craft in hand.
But your dining room might need some extra love these days, especially if your home feels a bit bare sans all the holiday decor. To help, we’ve gathered up some timeless dining room looks from Instagram that will make your space feel just as cozy as it did around the holidays.
Here are five decor ideas to keep the warm vibes going in your space well into the new year.
1. Dining room library
One of our favorite chic and snug looks for the season? This dining room/dream reading space by @kateabtdesign. The best part of this look is that it doesn’t take a lot of construction chops to achieve, just a few well-placed bookshelves.
“The concept of integrating a library into a dining room has grown more popular because it adds a layer of intellectual charm and character to the space,” says designer Guillaume Drew, of Or & Zon. “Bookshelves adds a warm, lived-in feel and a unique ambiance that’s both cultured and comfortable.”
Get the look: Get your dining room library off to an exciting start with this etagere bookshelf.
2. Warm wood side table
When creating a cozy space that you genuinely want to spend time in this winter, nothing achieves that feeling quite as well as vibrant wood tones. This is especially true when the wood vibes come in the form of a spotlight piece of furniture, like this side table from @oezlem.oezsoy.
“Warm wood tones have this inherent quality of making any space feel grounded and cozy due to their connection with nature and the outdoors,” says Drew. “The rich hues and grains pair well with both traditional and modern decor and evoke a sense of durability and timelessness.”
Get the look: Give your space a homey hue with this midcentury buffet in Acorn.
3. Woven-backed chairs
Another variation on the theme of using natural materials to create a grounded, comfortable space is a woven-backed chair, such as the ones featured by @heidicaillierdesign.
“Current dining areas are overwhelmingly wood—with hardwood flooring and built-in wood storage,” says designer Courtney Wollersheim, of FLOOR360. “Choose a dining room chair that has a complementary wood tone and woven seat back to tie the space together.”
Get the look: Complement your naturally decorated space with a set of these Astrid upholstered rattan dining chairs.
4. Grand-scale chandelier
Is a high ceiling making your dining room feel more formal than comfy? Not to worry. A perfectly placed grand-scale chandelier like this one from @chairishbydesign might be the thing to change that.
“Including a grand-scale chandelier in a dining room is more than just a statement. It’s about creating intimacy and ambiance,” says Drew. “The sheer size draws the eye up, then down, illuminating the room in a soft glow and shrinking to a more comfortable scale.”
Get the look: Cast a welcoming glow over your space with this Cassi 6 chandelier.
5. Tabletop taper candles
Taper candles are having a serious moment this winter. And if you’ve been feeling like your dining space lacks a certain glowing ambiance, then a few styled candles like these from @barwny_domek will work wonders.
“Your dining room tablescape is a space to showcase things that demonstrate your heritage, thrifting talent, eco-consciousness, and seasonal flavor,” says Wollersheim. “Tapered candles complement any style while adding an elegant vintage feel with warming, cozy candlelight.”
Get the look: Shop this collection of tapered candles on Etsy, or skip the matches and opt for a few of these Wick rechargeable LED table lights.