Low Inventory + Higher Interest Rates = 2023: As a result of the coronavirus pandemic, many American homeowners are interested in buying or selling their homes. At the same time, there is a decrease in the number of available homes for sale and an increase in interest rates. This combination could lead to big changes in the real estate market in 2023. Here’s what you need to know about the current situation and what it could mean for your real estate plans.
The current state of the housing market – low inventory and high-interest rates
The current state of the housing market is a cause for concern among many homeowners and potential buyers. Low inventory paired with high-interest rates has caused home prices to skyrocket, making it increasingly difficult for many to secure new homes or refinance their existing mortgages. If this trend continues, experts project that things could be even more challenging in 2023 due to these unfortunate conditions. It’s important that we remain cognizant of these issues and work together to ensure the health of our housing market.
How this will affect buyers in 2023 – they’ll have to be more strategic and prepared
For buyers in 2023, navigating the real estate market may require more strategic and thorough preparation. As inventory continues to drop and interest rates continue to rise, finding a good deal can be a challenge. Those who are prepared by having a timeline, financing options outlined, and an experienced agent at their side will find that they have the best chance of securing their ideal property – even if it means being open to different neighborhoods or types of homes. By knowing what to expect ahead of time and getting organized before jumping into the market, potential buyers in 2023 may be able to unlock some attractive opportunities.
What buyers can do to stay ahead of the game – start saving now, get pre-approved for a mortgage, work with a real estate agent
With a looming potential of higher interest rates and a low inventory trend in 2023, buyers should start taking proactive steps to stay ahead of the game. Specifically, they should start putting money away now, get pre-approved for a mortgage and work with a real estate agent to capitalize on their advantages in the market. This can help buyers minimize the impact of the expected low housing inventory and interest rate hikes on their ability to find their dream house. They should also explore loan options that are available compared to traditional mortgages to secure the best possible rate for their situation. Real estate agents will prove invaluable during this time by using their expertise to navigate the market dynamics of lower inventories and higher rates, helping buyers find that perfect home.
What sellers can do to take advantage of the situation – list their homes sooner rather than later, be flexible on price
With low inventory and higher interest rates forecasted in 2023, sellers should seriously consider listing their homes sooner rather than later to take full advantage of current market conditions. With a rising cost of borrowing due to interest rate hikes in the future, buyers may be more motivated to purchase now before the higher rates come into effect. To maximize profits on their home sale, sellers should also be flexible on price; lower prices can draw attention in an otherwise stagnant market, allowing them to make quicker sales with less hassle and time involved. Acting now will benefit sellers looking for a smooth transition between homes.
The bottom line – it’s still a good time to buy or sell a home, but you need to be smart about it
With low inventory and higher interest rates, it may not be the ideal market for home buyers and sellers in 2023 but, the bottom line is that it’s still a good time to buy or sell a home. Those who choose to engage with real estate now should be aware of the market conditions and take extra care to prepare their financials. Buyers will need a larger budget, while sellers may have to lower their asking price. It’s not an impossible scenario; those entering the real estate game right now just need to make smarter decisions in order to ensure they get the best possible outcomes.
If you’re thinking of buying or selling a home in 2023, you’ll need to be strategic. Get pre-approved for a mortgage and start saving now so you can be prepared for the higher interest rates. And if you’re a seller, list your home sooner rather than later. Be flexible on price and be ready to show your home at a moment’s notice. It’s still a good time to buy or sell a home, but you need to be smart about it.