The 2022 housing market brought many ups and downs for both buyers and sellers. So, what’s in store for the market this year? Check out these top real estate trends to expect in 2023.
Inventory is growing.
For quite some time now, the real estate market has been dealing with low inventory. Meaning, there were simply not enough homes to meet the demand of buyers. But that is quickly taking a turn.
Since May of 2022, inventory has begun to rise, with November 2022 having the largest jump. A major pro for buyers, the number of homes for sale is expected to continue to rise in 2023.
Home values are rising.
But for every effect, there is a cost. In part, the reason for the home inventory increase is higher home buying costs.
According to reports, the national median home price for active listings increased by 11 percent to $416,000 in November 2022 compared to November 2021. And, since the demand for homes is still high, prices will most likely stay that way too.
Interest rates are fluctuating.
In 2021, the average mortgage interest rate was lower than it’s ever been, but it has since gone up.
The average rate for a 15-year fixed-rate mortgage rose from 2.8 percent in January 2022 to 6.36 percent in October 2022–the highest it has been in more than 15 years!
Looking at the real estate trends to expect in 2023, we can expect mortgage rates to continue to climb through the first half of the year, but we may begin seeing a decline within the second half of the year.
More risky buying options are available.
As the trends evolve, so do the resources. There are now more risky home-buying options than ever to look out for and avoid. Including rent-to-own agreements, down payment loans and many others. Let’s take a look at what rent-to-own agreements and down payment loans can entail.
Are you looking to buy a home but just can’t afford it yet? Some sellers may offer a rent-to-own agreement. In this deal, you will agree to rent the home for a while before becoming the owner. This means you will get to move in faster, but you will also not qualify for a mortgage right away.
Down payment loans are another risky trend to avoid in 2023. Taking out a personal loan to fund a down payment is the same as buying a home with zero percent down. In other words, you borrow the entire cost of the home from two different lenders at two different interest rates.
Summary
Knowing what real estate trends to expect in 2023 and what risky ventures to avoid, you can now ask yourself the big question. Are you ready to buy or sell your home? If so, then contact Ryan Roberts! It always helps to have a local expert on your side.
For more real estate updates and news, continue reading our blogs.