NAR Economist 2023 Housing Market Trends: Rising Rates and Inflation
Rising interest rates and inflation set the stage for a nuanced real estate landscape in 2023, with tempered home price growth and heightened competition on the horizon.
Lawrence Yun, NAR’s Chief Economist and oversees NAR’s Research Group
NAR Real Estate Forecast Summit: Residential Update: Lawrence Yun’s Economic Insights
The New Work Era: Remote Work’s Impact
Let’s start with a big change we’ve all noticed: remote work. Thanks to many federal employees working from home, Washington’s streets are way less crowded. This isn’t just a local thing; cities everywhere are feeling the shift.
Borrowing Blues: Government’s Rising Rates
Here’s something to watch out for: the government’s borrowing rate has shot up to 4.1%. What does this mean for you? Well, it’s a hint that mortgage rates might be going up too.
U.S. Debt Downgrade: A Wake-Up Call?
The U.S. debt got a downgrade, mainly because the government’s spending more than it’s earning. But don’t panic! Lawrence believes the U.S. will always pay its debts. This might just be the nudge we need to get things in order.
Federal Reserve’s Moves: Interest Rates on the Rise
The Federal Reserve isn’t holding back. They’ve been pushing up interest rates, which means mortgages are getting pricier. Keep an eye on the next employment reports and inflation data; they’ll influence what happens next.
Economic Health Check: Mixed Signals
Our economy’s heartbeat, the GDP growth rate, isn’t racing. And the housing sector? It’s been feeling the pressure. But there’s hope! Lawrence thinks the housing downturn is almost over.
Inflation’s Heat: Will It Cool Down?
Inflation’s been running hot, which is why interest rates are up. But Lawrence has a hunch: things might cool down soon.
Housing Market Snapshot: Price Drops and Opportunities
Home prices have dipped by 1% across the country. But remember, it varies by region. A little nudge, like tax breaks for real estate investors, might just boost the market.
Job Market Jitters: More Jobs, Fewer Seekers
There are more job openings than people looking for work. But, openings are starting to drop, hinting at a possibly weaker economy ahead.
Mortgage Rate Crystal Ball: Ups and Downs Ahead
Expect mortgage rates to climb this year but possibly dip next year. A lot depends on factors like rent stability and the Federal Reserve’s moves.
Wrapping Up: Knowledge is Power
Lawrence’s key message? Stay informed. While there are challenges, there’s also room for growth and recovery.
NAR Real Estate Forecast Summit: Residential Update: Jessica Lautz’s Real Estate Rundown
RCI 101: What’s the Buzz?
The REALTORS® Confidence Index (RCI) is our go-to for the latest in real estate. Curious about the current scene? Here’s the scoop:
First-time buyers? They make up 27% of the market.
- Homes selling fast? 76% are off the market in under a month.
- All-cash deals? 26% of buyers are going this route.
- City life? Not so much. A whopping 87% are looking outside city centers.
2023 Housing Forecast: Peaks and Valleys
The housing scene’s been a bit slow this summer. With the 30-year mortgage rate nearing 7% in August and median home prices at $410,200, it’s been a rollercoaster. High rates, huge demand, and not enough houses have made things tight. And while new home sales dipped by 2.5% in June, affordability remains a big talker. For instance, if you’re earning $75,000, only 23% of listings might be in your budget. But don’t expect a foreclosure flood; almost half of the properties have solid equity.
Why RCI Matters: More Than Just Numbers
The RCI isn’t just data; it’s a window into the real estate world. It’s a compass for agents and brokers, guiding their strategies. Policymakers and economists? They rely on it to shape the future. And for buyers and sellers, it’s like having insider info to time their moves just right.
In a Nutshell: RCI’s Real Estate Pulse
The RCI is our real estate heartbeat. It tells us about challenges like high prices and limited houses but also points to opportunities. Whether you’re buying, selling, or just curious, staying informed with tools like the RCI is the way to go.
Watch the recording of the August 2, 2023, NAR Real Estate Forecast Summit: Residential Update.
- Kevin Sears, NAR 2023 First Vice-President
- Lawrence Yun, NAR Chief Economist
- Jessica Lautz, NAR Deputy Chief Economist
Real Estate Market Outlook August 2023
Presented by NAR Chief Economist Lawrence Yun at the NAR Real Estate Forecast Summit.
NAR Real Estate Forecast Summit August 2023
Presented by NAR Deputy Chief Economist Jessica Lautz at the NAR Real Estate Forecast Summit.