It’s no secret that 2022 was a big year in real estate! The housing market boomed through the summer and then began to slow down as interest rates climbed, inflation soared, and an uncertain economy loomed on the horizon. As we enter into the coming year, mortgage rates are expected to keep climbing before going back down. Fortunately, armed with knowledge and a helpful real estate agent and lender, it will be a buyer’s market.
Here are a few key takeaways as we consider the real estate industry forecast for 2023:
New research reveals that 49 percent of respondents would be willing to relocate to cheaper areas in an effort to find a more affordable cost of living. In other words, money is top of mind as we move into the new year.
For that very reason, pre-construction purchases are likely to become more popular, thanks to the availability of inexpensive lots and labor. Buyers often get better deals than they would if they purchased a property after it was completed. Plus, it’s a great way to get into an up-and-coming area. For Central Florida residents, some areas to consider include the city of Edgewater, which sits along the Indian River in Volusia county, or the town of Davenport, which is just south of many major tourist attractions and has easy access to shopping and roadways. Additionally, the town of Minneola, located west of Clermont, is filling up with beautiful family subdivisions.
During the past two years, when buyers were ultra-competitive during bidding wars, personalized offer letters helped you stand out from the crowd. Now, as the market slows down, this trend seems to be on its way out.
With prices climbing, longtime home buying trends are shifting. For instance, the need to have 20 percent for your down payment is no longer necessary or expected.
Additionally, sight-unseen offers are on their way out too. For the past two years, potential buyers would often do a virtual tour with their realtor and then make an aggressive offer — before ever stepping foot in the house!
Unfortunately, because there is so little inventory, many buyers will still face multiple offers on properties. However, people are less likely to pay above the asking price, so bidding wars will be less intense. Ultimately, you can expect to see three to five offers per listing but a final sale at list price.
In happier news, home prices are expected to stabilize by mid-year. As one recent article explained, “Prices will drop, but then rates will drop too. Buyers will see a price discount of five to ten percent and a ‘rate’ discount of one percent.” If we face a recession, these declines will be even steeper —potentially as high as 20 percent. Get ready to scoop up those deals!
At The Urban Dog Group, we’re excited to partner again with Michael Dean, Originating Branch Manager at CrossCountry Mortgage, LLC in downtown Orlando, to ensure that our clients receive top-notch service.
As real estate experts in Central Florida, we bring a wealth of knowledge and experience when it comes to buying and selling homes in Orlando, Winter Park, Ocoee, and other nearby areas. Thanks to the global reach of Coldwell Banker Realty, we can help you buy and sell properties outside of the Sunshine State as well. Check out our Active Listings for current and recent sales!
Let The Urban Dog Group help you with your real estate needs this holiday season. Contact Christine Elias at caerealestate@gmail.com.