Real Estate Trends for 2023
Housing trends are one of the most important factors that impact real estate market performance. It’s no secret that when the housing market is hot, people want to buy homes and rent them out. Likewise, if home prices are dropping or interest rates are rising, people aren’t going to invest in rental properties because they won’t be able to sell them at a profit later down the road. Understanding what these trends mean for your investments can help you make smarter choices about which properties to buy and when to sell.
The housing market is slowing down, and this trend is expected to continue into 2023. While most homeownership rates have been on the decline since their peak in 2004, the last few years have seen an increase in homeownership among millennials—the generation born between 1981 and 1996. However, this upward trend is expected to level off as these younger Americans age and move out of their parents’ homes.
Additionally, a large portion of the current housing market slowdown can be attributed to rising interest rates and stricter lending standards by lenders that were implemented after the 2008 financial crisis. These higher costs will also make it difficult for young adults entering their 20s or 30s without much savings or assets put away for a down payment; many are likely unable to afford home ownership even if they can secure financing from their lender (and if they do manage to buy a home).
The Federal Reserve is expected to raise its benchmark interest rate, this will have a direct impact on mortgage rates and, therefore, the housing market as a whole. It should also make purchasing homes more expensive for buyers because banks typically pass on their increased costs to borrowers via higher rates and fees for borrowers who don’t have strong credit scores or down payments that meet their requirements.
The trend of high appreciation is expected to continue in 2023. If you are looking to buy a house, this is good news. There are many reasons why this trend is continuing. In particular, the unemployment rate has dropped significantly over the past few years, allowing more people access to credit and other financial products they might not have been able to get previously.
Another reason for this trend is that millennials are beginning their careers at an older age than previous generations. This has allowed them to save money earlier than in the past and build up wealth that may be used on a down payment or closing costs when purchasing homes in the near future with their families as well
Understanding the Trends
Understanding the trends will help you make better real estate investment decisions. If you’re thinking about buying a home, now is the time to take action. As we mentioned above, there are many reasons why putting off buying a home until 2023 might not be in your best interest. If you are currently renting and looking to buy at this time, you should probably call an agent and get pre-approved for your mortgage so that you can make sure that everything goes smoothly once the market shifts.
If you are hoping to sell your house by 2023 (or before), it’s important for us all to understand what’s about to happen with real estate prices in order for sellers like yourself to avoid making mistakes in pricing or timing your sale. If you’re feeling uncertain about where prices will go between now and then, we suggest using a professional appraiser who specializes in valuing homes based on trends rather than just current local sales data alone.
It can be tricky to keep up with all the changes happening in such a fast-moving industry, but being aware of what’s happening will help you make better decisions about where your money goes and how best to invest it.