It’s that time of year when we set goals for ourselves—personal, financial. One of those goals may be making a move.
You may be asking yourself, is 2023 the year to buy a home? Only you can make that decision, but here are a few reasons to take into consideration:
Home Prices are Flattening…
After big gains in the past three years, home prices are expected to stay flat. The National Association of Realtors, or NAR, predicts median existing home prices will rise just 0.3% in 2023 — a stark contrast from the 9.6% year-over-year increase in 2022 and eye-popping 18.2% jump in 2021.
We are not going to see a “crash” in prices, so waiting for that to happen means missing out on homeowner benefits like tax deductions and savings built through property appreciation.
Interest Rates are ”Normal”
Rates go up and rates go down.
Mortgage interest rates went as high as 18.45% in 1981 and as low as 2.96% in 2021. That’s quite a range. But, when you look over the last 30 years, the average rate is 7.76%.
Interest rates right now are “normal, in fact, less than the 30 year average. For a jumbo loan, you can find rates between 5.-6%, well below the historical average. If you find a house that you love, my advice is, “Marry the House, date the rate.” If rates go down, you can always refinance.
More Negotiation Power
Because home prices and inventory are moderating, “you’re likely to find more negotiating room in 2023,” sellers will be open to accept contingencies like home inspections, appraisals and financing.” The market is more balanced and buyers have a little bit more control.
Rent Prices are Increasing
Usually, when home prices go up, rents go down. This is not what we are currently seeing. Home prices are remaining stable. During the last 12 months, rents have gone up by double digits.
When you own your home—you get a tax deduction for your property and school taxes, as well as your mortgage interest. You also have built in savings through property appreciation. When you rent—you get none of that.
Economists are expecting a market uptick for 2024–so if you are considering buying a home, 2023 might be a great opportunity.If you have questions, or want to talk about starting a home search, message me!
