National Association of Realtors 2023 Market Forecast
Let me share some hopeful news regarding your home investment!
In December, Lawrence Yun, PhD., NAR Chief Economist and Senior Vice-President for Research provided his expert opinion based on data collected and his research experience. There were several panelists who also weighed-in on their predictions for 2023, including Realtor.com and Corelogic. The news is positive and some may even say that if you watch the news, you and many others in the U.S., might just be talking yourselves into a housing recession based mostly on fear and not statistics. Here are some of the highlights pulled from the presentation.
While home sales have been down in 2022, they are really just closer to pre-pandemic norms.
Home Price Crash Coming?
The forecast says “no.” What makes this housing cycle different than the housing crash of 2008? Here are a few differences.
1. No more risky, sub-prime loans being offered. Now there are rules in place to ensure the ability to repay mortgage loans.
2. The mortgage delinquency rate was at 10.1% in 2008 and today the delinquency rate is 3.46%.
3. There were 4.6% homes in foreclosure in 2008 and today the foreclosure rate is .6%.
4. There were 8 million job cuts in 2008.
5. Today there are 20 million more people working than in 2008.
Will the Mortgage Rates Come Down?
The forecast says “yes.” What are the further forecast details regarding rates?
1. The Federal Reserve is seeing an impact on inflation based on their aggressive rate hikes.
2. They will begin to slow their increases.
3. The banks have already made their increases to mortgage rates based on increases they expected from the Feds. That being said, even if the Feds continue to make slight increases, the mortgage rates have likely hit their highest range.
4. Rates should decline and normalize in 2023.
5. Rates will likely settle around 5.5%, but will not return to 3%.
Employment Rate Compared between States is a Great Real Estate Market Indicator
Using National Real Estate Market data is a very general scope when trying to understand our local real estate strength. Just as in 2022, in the new year 2023 will have a wide range of market performance due to the volatile migration between U.S. regions. For example, the image below of the United States shows the percentage of payroll jobs compared between states. When considering the differences between state employment rates, the market strength is historically in-line with real estate performance. Each tend to go hand-in-hand.
Charleston Made the Top 10 Markets to Out-perform in 2023
1. Atlanta, GA
2. Raleigh, NC
3. Dallas, TX
4. Fayetteville, AR
5. Greenville, SC
6. Charleston, SC
7. Huntsville, AL
8. Jacksonville, FL
9. San Antonio, TX
10. Knoxville, TN
Now Let’s Compare these National Statistics with Our Charleston, SC local Statistics!
National data is a very general way of learning about the Real Estate Market for 2023.
Local Data shows the strength in the Charleston County Real Estate Market.
Looking for any other information regarding the Charleston, SC area Real Estate market? Contact me here!
