Will 2023 be a good time to buy a house?
As economic volatility further grips the US real estate market, housing activity is quickly declining. That's because inflation and interest rate hikes have outpriced many would-be home-buyers, leading to a steady decline in buyer demand. With fewer homes being sold, the housing supply is supposed to increase. A slowing overall economy could bring 30-year mortgage rates back down.
If a recession were to happen in early 2023, mortgage rates could fall around 30 basis points from the baseline forecast level of 5.2%. That means rates are likely to return to levels seen during the early months of 2022 when 30-year fixed rates were around 4%.
Economists are predicting that US home prices could fall more than 15% in 2023. If home sales were to fall even further than they have, economists believe US home prices could take an even steeper nosedive — and that could mean buyers could see greater affordability return to the market in the spring and summer of 2023.
For the past two years, it's been a seller's market. The question remains: will 2023 favor buyers or sellers more in most markets? When factoring in affordability issues and economic worries that will depress home buyer demand, combined with the inventory of homes available for sale that will remain limited, it's likely that a balanced market could be in the future, tilting slightly in the buyers favor.
Our team at Harnish Properties is here to help you navigate tricky real estate questions, whether you're looking to buy or sell. Give us a call.
201 B Avenue, Suite 101
Downtown Lake Oswego