Housing Market Predictions 2023
As we enter the last few weeks of the year and try to keep our heads on straight between sending holiday cards, packing goodies for the kids’ classroom party, and trying not to spend too much time during the workday shopping online for gifts, it’s also time to start thinking about resolutions for next year. Now, we can’t help you run to the post office for stamps or any of that other stuff. But what we can do is present a collection of housing market predictions 2023. Our hope is that these will help you make well-informed goals for 2023.
Housing Market Predictions 2023: Interest Rates
30-year fixed rates have fluctuated around 6.5% and 7% since the end of September and, consequently, home sales fell. So the big question when looking at housing market predictions 2023 is, will rates go down so that home sales can rise again? Vice President of Market Intelligence for ATTOM Data Solutions, Rick Sharga, predicts that mortgage interest rates will fall to 6-5.25% in mid-to-late 2023. And there are many others with similar predictions, the basis of which being the Fed’s aggressive efforts to control inflation.
Other authorities in the field, such as the senior economist and director of Real Estate Research for the National Association of Realtors, Nadia Evangelou, have offered up that we may not see rates fall in 2023 if the Fed repeatedly makes incremental increases to interest rates. Rather, rate decreases would begin in 2024. Now, the good news is that no one in the housing market predictions for 2023 seem to think that rates will skyrocket. Going into 2023, we can keep a close eye on the Fed and the rate of inflation, with the expectation that mortgage interest rates will stay about the same if not fall.
Housing Market Predictions 2023: Home Values
When asked if 2023 will be a sellers market, as the past two years have been, the response from Greg McBride, chief financial analyst for Bankrate, was that it will be relatively balanced between buyers and sellers. A key component of predicting home value behavior next year is not just mortgage rates but inventory. Looking purely at interest rates, some people might assume that home values have no choice but to plummet, right? And, sure, they will take a dip. But predictions from both Moody’s Analytics and the National Association of Realtors say, given the available inventory and continued sentiments of sellers, prices will only fall by 5-10%.
In 2023, we can expect that first-time buyers will continue to struggle to enter the market, but not as much as they did in the last 2 years. We can also expect in 2023 that sellers will get a good chunk of change for their homes as they are in the minority of owners making the decision to sell.
And there you have it. The conclusion of housing market predictions 2023 seems to be “Things will stay about the same for a while longer, with home prices decreasing slightly, and mortgage interest rates hopefully dropping later in the year.” With that conclusion, what will your goals be for 2023? And how can a mortgage expert help you get there? Contact us to get on the road to your real estate resolutions!
Carbonaro, G. (11 Nov 2022). Will house prices drop in 2023? Real estate experts give their predictions. Newsweek. https://www.newsweek.com/will-house-prices-drop-2023-real-estate-experts-predictions-1761338
Martin, E. (24 Oct 2022). Housing market predictions for 2023. Bankrate. https://www.bankrate.com/real-estate/housing-market-predictions-2023/