As part of owning a home, staying up-to-date on current and emerging trends in housing is essential. Thanks to an ever-evolving, dynamic real estate market, the process of buying or selling a home continually evolves year after year. With 2023 quickly approaching, now is the perfect time for all property owners—from buyers to sellers and even seasoned agents—to start getting prepared for what’s expected to come in the new year. Here are some of the top ideas that are likely going to impact home buying trends during 2023—so if you’re ready, let’s get started!
The Number of Available Homes is Increasing
Despite 2020’s disruption to the market, real estate is showing signs of recovery. November 2022 saw a 46% increase in home inventory month over month, surpassing May levels and approaching nearly two-thirds of pre-pandemic levels 2—an encouraging sign for both buyers and sellers as we approach 2021. The coming months will be key indicators if this trend holds true or whether other factors come into play; no matter what happens, though, you can stay up to date with the latest news from us!
Yearly Home Values are Rising
The 2021 real estate market has witnessed a steady rise in home values, with a November 2022 national median increasing 11% year-over-year to $416,000. Although this growth rate is not as high as the average of 16% seen over June and July of last year, it still suggests that buyers remain strong while inventory remains low – leading many experts to predict that 2023 will be an overall slow yet consistent expansionary period for housing prices. Buoyed by these predictions , month on month fluctuations can also be expected, but they are projected to continue above levels from early 2021 moving forward.
Mortgage Interest Rates Are Higher
This year’s real estate industry has seen mortgage interest rates reach a 15-year high. In October, the average rate on a 15-year fixed mortgage jumped from 2.8% to 6.36%, while that for 30 years reached 7.08%. With higher borrowing costs, now is an especially important time to explore financial options such as opting for shorter mortgages with lower interest rates; in this case, choosing a 15-year loan instead of its longer counterpart could mean significant savings over time!<>/p
Online Real Estate Services Are Growing
No doubt you’ve heard of real estate services like Zillow that let you browse or list homes for sale online. Did you know online services now offer to buy and sell your house for you?
Here’s how the new “iBuying” trend works: You tell companies like Opendoor about the house you want to sell. They buy it from you, pump some money into it to resell at a higher price, and handle all the home processing stuff like inspections, repairs, and home showings.
These companies promise you less hassle and charge you pretty much the same as an agent commission for selling costs—but it’s not all rainbows and sunshine. Some of these companies include an additional service fee (icing on their cake), which may mean less profit for you.
Worst of all, you don’t get the benefit of working with a top-notch agent who actually knows the current real estate market in your area and could sell your home for more money.
Risky Buying Options Are More Accessible
Creative home-buying options, like rent-to-own arrangements, may seem tempting with the promise of fast access to homeownership and lower upfront costs. However, these short cuts usually come at a cost: your monthly bills are likely going to be more expensive as some of the payment will go towards a later purchase, – making it harder for buyers with already tight finances. That said, everyone’s individual circumstances could play into whether such an arrangement might make sense or not; ultimately, though, when considering different buying strategies, caution is key!