Posted on 01/28/2023 12:39:17 PM PST by SaxxonWoods
“Home sales appear set to turn higher. Mortgage purchase applications have averaged 9% above their October trough so far in January and survey-based measures of purchasing intentions have rebounded sharply,” wrote Goldman Sachs researchers in their latest report.
By the time national home prices bottom, Goldman Sachs expects prices to be 6% below their June 2022 peak. That’s also a sharp revision from its previous prediction of a 10% peak-to-trough decline.
(Excerpt) Read more at fortune.com ...
Watching with interest. My county is predicted to have flat real estate prices in 2023. The worst declines are in urban areas pretty much countrywide.
After tripling the last decade they’re now going to be down just 6% from the high? It sounds like they’re trying to scare people into selling.
I have an extremely bad feeling about this year, but no record to stand on.
C’est la vie…
“They” aren’t going to scare anyone. Few people ever read financial articles. The housing slowdown has just begun. I worked in this field for a long time, the cycle usually takes several years to play out.
This downturn is full of variables including Covid influences which doesn’t have a parallel, so forecasting is very difficult. This slowdown has just begun, it often takes 3-5 years to work through one.
But typical housing downturns involve oversupply of product as a boom matures, meeting higher interest rates and a slower economy. The current situation has undersupply. That’s very unusual but could indicate the downturn in residential real estate may be mild and relatively short-lived.
We also have demographic support for housing. We have a large group of young people with high incomes who want to own real estate. Also, a record 37% of homes have no mortgage. The rest of homeowners just had plenty of chance to refinance at unheard of interest rates. The pool of distressed housing in this downturn will be lower than usual.
Many sellers here in Georgia haven’t yet figured out that average sale prices have declined from their peak, so asking prices have been slow to fall. The result is that many houses are sitting on the market longer.
Housing is always “sticky” on the downside as sellers remain in denial—for a while.
RE: National home prices have further to fall,
Or....
“She never stumbles, she’s got no place to fall” Bob Dylan
Yeah, that’s exactly the usual pattern. Also, we are used to mutilple offers on day 1. In a typical housing market the average number of days from listing to contract is 90.
DOM (days on the market) stats are available for your area. It’s a good indicator of local market conditions especially when followed over time.
New homes under contract actually went up in November, the last month we have figures for. That was due to a dip in rates. This demonstrates the buyers are out there. But the FED has to beat inflation (it says) before it opens the floodgates again.
Hubby currently has a listing and the sellers overpriced it, so not much happening at the moment. 😖
Watching with interest. My county is predicted to have flat real estate prices in 2023. The worst declines are in urban areas pretty much countrywide.
*********”
In my county it looks like more houses are entering the market the last couple of months and staying longer before finding a buyer. Most of them look like pre 1970 housing that has a low sq footage and might need some fixing up. They’re also located in the cities not the rural areas.
In my area, newcomers will have to rent an inflated apartment or wait 3-5 years for some of the builders to complete their current housing projects.
Because of higher interest rates there are two separate real estate markets these days—buyers who can do cash only and buyers who need mortgages.
Maybe finally time to buy?
If you can wait six months or so prices should drop very well for you—the sellers will have to capitulate to the reality of higher interest rates.
I hope the prices do not yet fall too far. We are just next week putting my late mother’s house on the market. Rural county, red state. It’s 9 acres and a small house in a secluded area (no HOA), where the deer are plentiful and the whippoorwills sing nightly.
I’m hoping it will sell quickly so my sisters and I can be done with the daily “one more thing to think about” list. I’ve come to terms months ago with the fact that we have to sell it. It is the house my siblings and I grew up in and I tear up when working in it just because of the overwhelming memories. However, it’s taking up so much of our time and energy.
I’ve been dealing with nothing but probate and estates for the past almost three years. First my mother-in-law, then my father-in-law, and next my mother, passed away. The stress has added years to my life. Then last week, we had one more death to add to the list. A well-loved nephew passed away at age 36. I know many families are dealing with the same issues as the deaths pile up one by one.
I’m ready to be done with it all!
There are still growing counties where there is upward pressure on prices and inventory.
Most of the growing counties are boomer retirement destinations—and the boomers can often pay all or almost all cash for homes.
The rest of the country is getting crushed by the higher mortgage interest rates.
There’s always a silver lining...if you have enough silver!
Still building craploads of houses in ada County. Must be a lot of blue state refugees continuing to in. Willing to pay double what the houses are worth.
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