![Key Terms To Know When Buying a Home [INFOGRAPHIC] | MyKCM](https://files.mykcm.com/2023/01/11164544/Key-Terms-To-Know-When-Buying-A-Home-MEM-1046x2684.png)
If you’re thinking about buying or selling a home soon, you probably want to know what you can expect from the housing market this year. In 2022, the market underwent a major shift as economic uncertainty and higher mortgage rates reduced buyer demand, slowed the pace of home sales, and moderated home prices. But what about 2023?
An article from HousingWire offers this perspective:
“The red-hot housing market of the past 2 ½ years was characterized by sub-three percent mortgage rates, fast-paced bidding wars and record-low inventory. But more recently, market conditions have done an about-face. . . . now is the opportunity for everyone to become re-educated about what a ‘typical’ housing market looks like.”
This year, experts agree we may see the return of greater stability and predictability in the housing market if inflation continues to ease and mortgage rates stabilize. Here’s what they have to say.
The 2023 forecast from the National Association of Realtors (NAR) says:
“While 2022 may be remembered as a year of housing volatility, 2023 likely will become a year of long-lost normalcy returning to the market, . . . mortgage rates are expected to stabilize while home sales and prices moderate after recent highs, . . .”
Danielle Hale, Chief Economist at realtor.com, adds:
“. . . buyers will not face the extreme competition that was commonplace over the past few years.”
Lawrence Yun, Chief Economist at NAR, explains home prices will vary by local area, but will net neutral nationwide as the market continues to adjust:
“After a big boom over the past two years, there will essentially be no change nationally . . . Half of the country may experience small price gains, while the other half may see slight price declines.”
Mark Fleming, Chief Economist at First American, says:
“The housing market, once adjusted to the new normal of higher mortgage rates, will benefit from continued strong demographic-driven demand relative to an overall, long-run shortage of supply.”
If you’re looking to buy or sell a home this year, the best way to ensure you’re up to date on the latest market insights is to partner with a trusted real estate advisor. Let’s connect.
If you’re thinking about buying or selling a home, you probably want to know what’s really happening with home prices, mortgage rates, housing supply, and more. That’s not an easy task considering how sensationalized headlines are today. Jay Thompson, Real Estate Industry Consultant, explains:
“Housing market headlines are everywhere. Many are quite sensational, ending with exclamation points or predicting impending doom for the industry. Clickbait, the sensationalizing of headlines and content, has been an issue since the dawn of the internet, and housing news is not immune to it.”
Unfortunately, when information in the media isn’t clear, it can generate a lot of fear and uncertainty in the market. As Jason Lewris, Cofounder and Chief Data Officer at Parcl, says:
“In the absence of trustworthy, up-to-date information, real estate decisions are increasingly being driven by fear, uncertainty, and doubt.”
But it doesn’t have to be that way. Buying or selling a home is a big decision, and it should be one you feel confident making. To help you separate fact from fiction and get the answers you need, lean on a local real estate advisor.
A trusted expert is your best resource to understand what’s happening at the national and local levels. They’ll be able to debunk the headlines using data you can trust. And using their in-depth knowledge of the industry, they’ll provide context so you know how current trends compare to the normal ebbs and flows in the industry, historical data and more.
Then, to make sure you have the full picture, they’ll tell you if your local area is following the national trend or if they’re seeing something different in your market. Together, you’ll use all of that information to make the best possible decision for you.
After all, making a move is a potentially life-changing milestone. It should be something you feel ready for and excited about. And that’s where an agent comes in.
If you have questions about the headlines or what’s happening in the housing market today, let’s connect so you have expert insights and advice on your side.
Mortgage Rates Are Dropping. What Does That Mean for You?
Mortgage Rates Are Dropping. What Does That Mean for You? | MyKCM
Mortgage rates have been a hot topic in the housing market over the past 12 months. Compared to the beginning of 2022, rates have risen dramatically. Now they’re dropping, and that has to do with everything happening in the economy.
Nadia Evangelou, Senior Economist and Director of Forecasting at the National Association of Realtors (NAR), explains it well by saying:
“Mortgage rates dropped even further this week as two main factors affecting today's mortgage market became more favorable. Inflation continued to ease while the Federal Reserve switched to a smaller interest rate hike. As a result, according to Freddie Mac, the 30-year fixed mortgage rate fell to 6.31% from 6.33% the previous week.”
So, what does that mean for your homeownership plans? As mortgage rates fluctuate, they impact your purchasing power by influencing the cost of buying a home. Even a small dip can help boost your purchasing power. Here’s how it works.
The median-priced home according to the National Association of Realtors (NAR) is $379,100. So, let’s assume you want to buy a $400,000 home. If you’re trying to shop at that price point and keep your monthly payment about $2,500-2,600 or below, here’s how your purchasing power can change as mortgage rates move up or down (see chart below). The red shows payments above that threshold and the green indicates a payment within your target range.
Mortgage Rates Are Dropping. What Does That Mean for You? | MyKCM
This goes to show, even a small quarter-point change in mortgage rates can impact your monthly mortgage payment. That’s why it’s important to work with a trusted real estate professional who follows what the experts are projecting for mortgage rates for the days, months, and year ahead.
Bottom Line
Mortgage rates are likely to fluctuate depending on what happens with inflation moving forward, but they have dropped slightly in recent weeks. If a 7% rate was too high for you, it may be time to contact a lender to see if the current rate is more in line with your goal for a monthly housing expense.
![Reasons To Sell Your House This Season [INFOGRAPHIC] | MyKCM](https://files.mykcm.com/2022/12/08121045/Reasons-To-Sell-Your-House-This-Season-MEM-1046x2601.png)
If you’re thinking about buying or selling a home this year, you may have questions about what’s happening with home prices today as the market cools. In the simplest sense, nationally, experts don’t expect prices to come crashing down, but the level of home price moderation will depend on factors like supply and demand in each local market.
That means, moving forward, home price appreciation will continue to vary by location, with more significant changes happening in overheated areas. Here’s a quick snapshot of what the experts are saying:
Danielle Hale, Chief Economist at realtor.com, says:
“The major question on the minds of homeowners and aspiring buyers alike is what will happen to home prices. . . Soaring prices were propelled by all-time low mortgage rates which are a thing of the past. As a result, home price growth is expected to continue slowing, dipping below its pre-pandemic average to 5.4% for 2023, as a whole.”
Mark Fleming, Chief Economist at First American, says:
“House price appreciation has slowed in all 50 markets we track, but the deceleration is generally more dramatic in areas that experienced the strongest peak appreciation rates.”
Taylor Marr, Deputy Chief Economist at Redfin, says:
“For those bearish folks eagerly awaiting the home price crash, you'll have to keep waiting. As much as demand is pulling back supply is as well reducing downward pressure on prices in the short run.”
John Paulson, Founder of Paulson & Co., says:
“It’s true – housing may be a little frothy. So housing prices may come down or they may plateau . . .”
The best way to get the answers you need is to lean on a local real estate advisor. They’ll be able to explain the latest trends in your specific market so you can make a confident and informed decision on your next step toward buying or selling a home.
If you have questions about what’s happening with home prices today, let’s connect so you have the latest on our local market.
There’s no denying the housing market is undergoing a shift this season, and that may leave you with some questions about whether it still makes sense to sell your house. Here are three of the top questions you may be asking – and the data that helps answer them – so you can make a confident decision.
Even though the supply of homes for sale has increased in 2022, inventory is still low overall. That means it’s still a sellers’ market. The graph below helps put the inventory growth into perspective. Using data from the National Association of Realtors (NAR), it shows just how far off we are from flipping to a buyers’ market:
While buyers have regained some negotiation power as inventory has grown, you haven’t missed your window to sell. Your house could still stand out since inventory is low, especially if you list now while other sellers hold off until after the holiday rush and the start of the new year.
If you’re thinking of selling your house but are hesitant because you’re worried buyer demand has disappeared in the face of higher mortgage rates, know that isn’t the case for everyone. While demand has eased this year, millennials are still looking for homes. As an article in Forbes explains:
“At about 80 million strong, millennials currently make up the largest share of homebuyers (43%) in the U.S., according to a recent National Association of Realtors (NAR) report. Simply due to their numbers and eagerness to become homeowners, this cohort is quite literally shaping the next frontier of the homebuying process. Once known as the ‘rent generation,’ millennials have proven to be savvy buyers who are quite nimble in their quest to own real estate. In fact, I don’t think it’s a stretch to say they are the key to the overall health and stability of the current housing industry.”
While the millennial generation has been dubbed the renter generation, that namesake may not be appropriate anymore. Millennials, the largest generation, are actually a significant driving force for buyer demand in the housing market today. If you’re wondering if buyers are still out there, know that there are still people who are searching for a home to buy today. And your house may be exactly what they’re looking for.
If current market conditions have you worried about how you’ll afford your next move, consider this: you may have more equity in your current home than you realize.
Homeowners have gained significant equity over the past few years and that equity can make a big difference in the affordability equation, especially with mortgage rates higher now than they were last year. According to Mark Fleming, Chief Economist at First American:
“. . . homeowners, in aggregate, have historically high levels of home equity. For some of those equity-rich homeowners, that means moving and taking on a higher mortgage rate isn’t a huge deal—especially if they are moving to a more affordable city.”
If you’re thinking about selling your house this season, let’s connect so you have the expert insights you need to make the best possible move today.
Now that the end of 2022 is within sight, you may be wondering what’s going to happen in the housing market next year and what that may mean if you’re thinking about buying a home. Here’s a look at the latest expert insights on both mortgage rates and home prices so you can make your best move possible.
There’s no doubt mortgage rates have skyrocketed this year as the market responded to high inflation. The increases we’ve seen were fast and dramatic, and the average 30-year fixed mortgage rate even surpassed 7% at the end of last month. In fact, it’s the first time they’ve risen this high in over 20 years (see graph below):
In their latest quarterly report, Freddie Mac explains just how fast the climb in rates has been:
“Just one year ago, rates were under 3%. This means that while mortgage rates are not as high as they were in the 80’s, they have more than doubled in the past year. Mortgage rates have never doubled in a year before.”
Because we’re in unprecedented territory, it’s hard to say with certainty where mortgage rates will go from here. Projecting the future of mortgage rates is far from an exact science, but experts do agree that, moving forward, mortgage rates will continue to respond to inflation. If inflation stays high, mortgage rates likely will too.
As buyer demand has eased this year in response to those higher mortgage rates, home prices have moderated in many markets too. In terms of the forecast for next year, expert projections are mixed. The general consensus is home price appreciation will vary by local market, with more significant changes happening in overheated areas. As Mark Fleming, Chief Economist at First American, says:
“House price appreciation has slowed in all 50 markets we track, but the deceleration is generally more dramatic in areas that experienced the strongest peak appreciation rates.”
Basically, some areas may still see slight price growth while others may see slight price declines. It all depends on other factors at play in that local market, like the balance between supply and demand. This may be why experts are divided on their latest national forecasts (see graph below):
If you want to know what’s happening with home prices or mortgage rates, let’s connect so you have the latest on what experts are saying and what that means for our area.
.png)