What will the Real Estate Ride look like in 2023? Roller Coaster

by Craig Wales with Guaranteed Rate

the year. The Fed is expected to keep increasing their rate to get inflation under control, but at a slower pace in the first part of 2023. That should affect mortgage rates, allowing them to continue dropping.

Expert predictions on rates

Many of the most respected industry watchers are predicting rates will continue to come down in 2023. The Mortgage Bankers Association (MBA) and the National Association of Realtors® (NAR) are both forecasting that mortgage rates will come down throughout the year, and finish 2023 in the mid-5% range. Fannie Mae and Freddie Mac take less optimistic views; seeing rates hovering in the high-6% range and finishing the year near 6.2%-6.5%.

Home prices: Up or down?

Tracking home prices can be a good news/bad news proposition. When home prices go up, that’s good news for homeowners and sellers, but bad news for homebuyers. When they go down, that could be seen as bad news for homeowners as their home’s value is also theoretically going down as well.

However, high home prices and high rates have priced many wouldbe homebuyers out of the market and that’s been bad news for sellers lately. A drop in home prices, along with a drop in mortgage rates, would be great news for everyone.

Home price forecast

Real estate experts are predicting good news for homebuyers. Their forecast is for the first year-over-year decline in the last decade, with the average home price at $368,000. While home prices aren’t dropping to pre-pandemic levels, by most of these forecasts they are likely staying near where they ended in 2022 as we move ahead in 2023.

Looking ahead at housing affordability

Mortgage rates coming down, and home prices at a lower average than last year means housing greater affordability. Hopefully, in 2023, more people will be able to say, “Yes,” to buying a home.

WHAT MAKES TEXAS "TEXAS"

by Charlotte Kovalchuk and Ann Marie Kennon