Bloomberg
With mortgage rates retreating from their highest since 2002 and the US housing market cooling, some buyers are expecting to get a deal next year instead of having to contend with sky-high home prices. Unfortunately, that’s just wishful thinking.
Although most economists think rates have peaked — or close to it — the consensus is that rates will hover around 6.5% or 7% for 30-year fixed mortgages for the foreseeable future.
And on home prices, there’s no reason to think we’ll see big declines any time soon. I surveyed half a dozen economists to find out where home prices are headed in 2023. By and large, most are anticipating prices on average to stay within 5% of where they are now.
One of the most bearish scenarios foresees a 20% drop in prices in 2023. But even analysts who expect a drop of that magnitude think it would be spread out over several years.
That’s little consolation for those who had hoped a big decline in home prices could soften the blow of mortgage rates that have doubled over the last 10 months. Consider this: To keep mortgage payments at the historical share of household income (about 18%), home values would need to drop 39% from where they are currently, according to Zillow.
Continue reading on Bloomberg
may require a subscription
=====================================================================
As noted in yesterdays post - Foothills Q4 median sold prices are down 3.44% from their peak in Q2 of this year - not terrible, but we'll see where it goes from here. And a good time to see where it goes is right around the corner, the beginning of what has traditionally been our busiest season kicks off in January and runs into May.
And Jan - May is our busy season because 2 things occur- there are more buyers and more sellers in the market. More buyers arrive to buy homes while enjoying our wonderful winter/spring weather and, traditionally, more sellers list their homes for sale during that time because there are more buyers in the market. Supply & Demand.
But if there are too few homes for sale it won't be a very busy busy season. And even now, before the season has begun, there are not enough. And so far there are no signs that a large number of sellers are going to list their homes. And without a sizable increase in inventory there will be more competition for the too small supply of homes which I imagine will keep prices high and once again prove frustrating for buyers.
Thanks for stopping by...
John Schneider /Realtor®
Tierra Antigua Realty
Catalina Foothills Homes
johnschneiders@gmail.com
520 271-4164
TheFoothillsToday.com
to see all the homes for sale in the Catalina Foothills
(and only in the Catalina Foothills)
