Confused about where the real estate market is headed. You're not alone, everyone is. And while the following articles won't sort it all out they may at least offer some food for thought while showing the wide range of opinions among the experts.
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From Bloomberg
Higher Mortgage Rates Is What the Housing Market Needs Now
Homebuyers are more resilient than expected. Costs will have to rise again to choke off demand and bring inflation down to the Fed’s target.
The surprise of January was how strong the economy started off the year — particularly the housing market. All it seemed to take for buyers to come flocking back was for 30-year-mortgage rates to ease to near 6% after reaching as high as 7.25% in October.
Mortgage purchase applications are rising again. The glut of existing homes we expected as the market slowed last year never materialized. Homebuilders’ stocks have surged. Goldman Sachs Group Inc. now believes home prices will fall by 6% from the peak, rather than its previous forecasted of a 10% decline. The housing analytics firm CoreLogic is even predicting a rise in home prices in 2023.
It seems the housing market is making clear what it needs to cool down: higher mortgage rates.
The strength in the housing market is an unwelcome development in the Federal Reserve’s fight to lower inflation to 2%. Fed Chairman Jerome Powell spoke last year about the need for a "reset" in the housing market. To the extent the Fed’s tweaking of interest rates is meant to help balance the market, the evidence so far in 2023 is that a rate of 6% is too low. To keep the economy from overheating, mortgage rates around 6.5% — their closing level on Friday — get closer to the mark.
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From Fortune
Zillow says the home price correction is winding down—here’s what 28 other forecast models have to say
BY LANCE LAMBERT
February 13, 2023 at 11:18 PM MST
Almost every month for the past year Zillow has revised its 12-month home price outlook downward. That finally changed on Monday.
Heading forward, Zillow economists now expect U.S. home prices to rise 0.5% between January 2023 and January 2024. That’s slightly improved from its previous 12-month outlook of a 1.1% decline.
This upward revision by Zillow, coupled with slightly improved mortgage purchase application data, is why Fortune once again tracked down the latest home price forecasts from 29 of the nation’s leading real estate researchers. Among those forecasters, six expect U.S. home prices to grow or remain flat in 2023, while the other 23 believe U.S. home prices have further to fall. (You can find our prior forecast round-up here).
Realtor.com: The economics team at Realtor.com predicts that the median price of existing homes will rise 5.4% in 2023 while mortgage rates average 7.4%.
Home.LLC: The firm predicts U.S. home prices will rise 4% in 2023
CoreLogic: The real-estate data firm predicts that U.S. home prices will rise 3% between December 2022 and December 2023. (Here is CoreLogic's latest risk assessment for the nation's 392 largest regional housing markets.)
NAR: The trade group projects that existing home prices are poised to rise 1.2% in 2023 while mortgage rates will average 6.3%.
Zillow: Economists at the home listing site forecast that U.S. home values will rise 0.5% between January 2023 and January 2024. Below is their regional outlook.
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John Schneider /Realtor®
Tierra Antigua Realty
Catalina Foothills Homes
johnschneiders@gmail.com
520 271-4164
see TheFoothillsToday.com
to see all the homes for sale in the Catalina Foothills
(and only in the Catalina Foothills)
