Some refer to the current housing market as “recovering”, while others call it “in transition”. The truth is, none of us know for sure what’s coming.
Thank you for reading this post, don't forget to subscribe!We know that today’s real estate market is not what we are used to. If you’re the adventurous type, this is an exciting time.
To help you weather the current market, let’s unpack the various forecasts floating around online and try to make sense of some of them.
concessions, concessions everywhere
When was the last time you saw a shopping offer full of buyer discounts? This is largely unknown to new agents joining the industry in the past few years. According to Redfin’s research, however, today rate buydown requests, money for repairs, helping with closing costs, etc. are making a comeback.
Lily Katz and Taylor Marr at Redfin.com claim, “Home sellers made concessions to buyers in the fourth quarter in 41.9% of home sales … That’s up from just over 30% in both the previous quarter and the fourth quarter of 2021.”
In 2022, San Diego could see concessions included in 73% of home sales, while 62.9% of Phoenix contracts included concessions.
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Will rates leave their upward trajectory?
Experts are present everywhere regarding this. Bankrate chief financial analyst Greg McBride says rates for 30-year mortgages will sit at 5.25% through the end of 2023.
Between now and then, our poll of various experts reveals:
- “Fannie Mae expects the 30-year average rate to reach 6.8% in 2023,” claims Kevin Graham at Rocket Mortgage.
- Freddie Mac is predicting that the 30-year rate will be 6.4%.
- Bob Brockschmidt, president of the Mortgage Bankers Association, forecasts a 5.2% 30-year rate through the end of this year. (housingwire.com)
As you can see, experts are all over the map when it comes to predicting future mortgage rates. To get a better feel for what to expect in the spring real estate market, the pros at The Motley Fool urge us to keep an eye on the March Fed meeting (March 21 and 22, 2023).
Will there be a buyer?
The Showtime Showing Index®, at the time of this writing, reports that home showings are down more than 30% nationwide. This decline is due, in large part, to the general winter slump, so it’s not as scary as it appears on the surface.
According to a poll on NBC.com, more than half of homebuyer respondents say the economy is causing them to reconsider buying a home. The good news is that nearly 1/3 of respondents answered that they are still considering making a purchase.
If the Fed plays nice, we could have a nice spring real estate market. Stay in touch with your field and farm, and you’ll be far ahead in the game.
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