You know the saying “if I had a Crystal Ball” – well, I personally like to add “I probably wouldn’t be working” to the end. With that being said, while I am using educated, reliable economic data and sources to share with you a 2023 outlook, please know that things happen ALL the time to change that (hello, 2020!) so these thoughts and opinions are mine and my own (and subject to change!)
So…let’s get to it!
I saw someone call 2023 a “nobody’s market” and physically had to calm myself down before even beginning to write about this. Yes, days on market are on the rise. Yes, there’s more inventory. Yes, there’s more pricing and repair negotiations. AND there’s also sellers taking advantage of unprecedented equity growth over a short period of time all the while buyers have the chance to actually think about a home before writing an offer without having to put a 6 figure non-refundable deposit on the line! Can we please start referring to 2023 as an “everyone’s market” instead?
2. Year of the Investor
2023 is the Year of the Rabbit – which historically is associated with vigilance, wit, quick-mindedness & ingenuity. How fitting that I also believe 2023 will be associated with investors. As rates have risen and affordability of homes has dwindled, increased rental demand continues to put pressure on already rising rental rates. Nationwide, according to Forbes, the rental rates are predicted to rise by about 6.3%. With more inventory, more negotiations, and higher rental rates, now is a better time than ever to get on Parker Residential’s “Best Buy List” for 2023. Want in? Shoot me an email – firstname.lastname@example.org.
3. The Market May Slow a Bit….but Homebuying and Selling is Never Going Away
At the end of the day, I help you buy and sell shelter. There will always be a demand for a roof over your head. Keller Williams preaches the 6 D’s when it comes to steady homebuying and selling….death, divorce, dividends, deployment, dependents, and downsizing. Whether you’re a home buyer who needs more space for a growing family or a seller looking for the right partner in the emotional turmoil of an estate sale – I am here to help you and rest assured, there will ALWAYS be a buyer or seller on the other side.
4. If Prices Decline, Homeowners are Still Winning
In November 2022, Raleigh home prices were up 8.7% year over year according to Redfin. Let’s walk through this. In November 2021, you purchased a home for $400,000. It’s now the end of 2022 and your home is worth $434,800. Fast forward to end of 2023, priced have declined 3% (which, by the way, is an aggressive calculation) and your home is worth $421,756. And yet….it’s still worth 5.7% more than what you bought it for just two years prior. Getting sellers to focus on the equity gained and the win of their investment rather than the TY/LY comparison will be a big hurdle in 2023. There is no such thing as a “good” market or “bad” market…just the market we are in.
Honestly, who the heck knows. In November, rates hit a 20 year high at just above 7%. Shortly thereafter, we’re now in the mid to low 6%s. Some experts are predicting fluctuations between 6-7% throughout the year and others have been bold in saying closer to 5%. Either way, with an average of 7.1% since the 80’s….it’s still considered manageable. My philosophy? If you can afford the home’s monthly payment…buy it! Rates go down? Great, refinance (shoutout to Bill Duff with Highlands who’s covering those fees for anyone who refi’s within 3 years!) Rates go up? Cool – you’re locked in! Rates stay the same, you likely got in at a price that is only going to gain equity over time….history doesn’t lie!
6. Your Choice for Realtors Will be More Slim
Data shows that over the past 5 years alone, 300,000 realtors have been added to your options as a trusted partner to buy or sell your home. 1/3 of those joined in 2021. A SHIFTing market weeds out the good, experienced and creative advocates from those that aren’t performing as much. Whether you’re choosing an agent based on skills, performance and numbers or leaning more toward the one you know is going to care the most – I hope to be the choice in either of the categories.
Allie, Your Raleigh Area Realtor