Since the pandemic, the housing market shifted definitively into a seller\u2019s market. With a shortage of inventory and increased demand, sellers held the upper hand. <\/p>\n\n\n\n
But the real estate market is also shifting. Demand is decreasing, there\u2019s more inventory available, and interest rates have begun to rise. But are we in a buyer\u2019s market yet? <\/p>\n\n\n\n
>> Related Read – <\/strong>Housing Market Predictions for 2023 + The Next 5 Years<\/strong><\/a> <\/p>\n\n\n\n While the housing market is cooling off, it\u2019s still a seller\u2019s market in 2023. The Knock Buyer-Seller Market Index<\/a> indicates that of the 100 largest housing markets in the nation, 36 are forecast to be buyers\u2019 markets by November 2023. However, 41 markets will remain sellers\u2019 markets, while 23 will be neutral. While buyers will enjoy some leverage, particularly toward the end of 2023, we\u2019re still solidly in a seller\u2019s market. <\/p>\n\n\n\n Multiple factors contribute to that seller\u2019s market. The supply of homes for sale<\/a> remains limited for several reasons. Most buyers who purchased homes during the past few years and who had very low-interest rates won\u2019t want to sell anytime soon. New home construction has also fallen in January for the fifth straight month, which is only contributing to the shortage of housing inventory. <\/p>\n\n\n\n Home prices<\/a> are also affecting the market. If inflation drops, then home prices will drop some, but likely not enough to make a major difference in the market. Rising interest rates will still keep monthly mortgage payments up, so buyers are unlikely to see overall more affordable homeownership. <\/p>\n\n\n\n With continued limited inventory and the average cost of buying a home likely to remain about the same, we will remain in a buyer\u2019s market in 2023. <\/p>\n\n\n\n >> Related Read – <\/strong>How to Find Houses Before They Hit the Market<\/strong><\/a> <\/p>\n\n\n\n The economy also directly affects the housing market. When economies slow down, it\u2019s more difficult to borrow money, meaning fewer buyers purchase homes, and demand decreases. In contrast, it\u2019s easier to borrow money in a thriving economy, and buyers are more likely to purchase homes. <\/p>\n\n\n\n While mortgage rates<\/a> are dropping, they are still nearly double what they were a year ago. Those higher interest rates make homeownership unaffordable and unappealing to some buyers. If inflation slows, those rates may drop further, generating more sales and allowing more buyers to secure a mortgage at more affordable terms. <\/p>\n\n\n\n Looking at the Consumer Price Index<\/a> also provides a gauge of the changing prices that urban consumers are paying over time. As of January 2023, food costs had risen by 10.1%, energy increased by 8.7%, and new vehicles had increased by 5.8% over the last 12 months. These percentages reflect steep increases in the prices that consumers pay. These rising costs indicate that inflation is still an issue in the country and that borrowing money may be challenging, as a result. <\/p>\n\n\n\n >> Related Read – <\/strong>Is It Better to Rent or Buy Right Now?<\/strong><\/a> <\/p>\n\n\n\n In a buyer\u2019s market, there are more homes for sale than there are buyers looking for those homes. With so much inventory to choose from, buyers have more leverage, and sellers are more likely to drop the price of their homes to appeal to those buyers and close deals. Homes also tend to sit on the market longer. <\/p>\n\n\n\n It\u2019s ideal to purchase a home in a buyer\u2019s market, and the following tips can help you to get a good deal on the right home. <\/p>\n\n\n\n Related Read – <\/strong>Renting vs. Buying a House: Advantages & Disadvantages<\/strong><\/a> <\/p>\n\n\n\n In a seller\u2019s market, there is more demand for homes than there are homes for sale. As a result of that low inventory, buyers compete with each other for available properties. Sellers hold an advantage in this market, so they may ask for higher prices and be less willing to negotiate with buyers. It\u2019s also more common for buyers to get into bidding wars, which can further drive up home prices. Homes tend to sell more quickly, so buyers must be willing to act promptly. <\/p>\n\n\n\n You can still buy a home in a seller\u2019s market, but you will need to be strategic in your home-buying approach. <\/p>\n\n\n\n Related Read – <\/strong>What Not to Do Before & When Buying a House<\/strong><\/a> <\/p>\n\n\n\n In a seller\u2019s market, it\u2019s important to have a real estate agent who is well-informed, has an excellent network, and can help to guide you through the process of buying a home. The Guidance Home Services real estate agents are highly knowledgeable, friendly, and helpful, making them ideal partners to support you on your home-buying journey. <\/p>\n\n\n\n Additionally, Guidance Residential account executives are highly experienced and knowledgeable in the mortgage industry. They can answer your pre-qualification<\/a> and mortgage questions and help you through every step of getting pre-qualified<\/a> and applying for a mortgage. <\/p>\n<\/div><\/div>\n\n\n\nIt\u2019s Still a Seller\u2019s Market in 2023<\/h2>\n\n\n\n
How the Economy Affects the Housing Market<\/h3>\n\n\n\n
What Is a Buyer\u2019s Market?<\/h2>\n\n\n\n
3 Tips for Buyers in a Buyer\u2019s Market<\/h3>\n\n\n\n
What Is a Seller\u2019s Market?<\/h2>\n\n\n\n
4 Tips for Buyers in a Seller’s Market<\/h3>\n\n\n\n
The Bottom Line: Let Guidance Be Your Guide<\/h2>\n\n\n\n