72% of Buyers Who Failed to Find a Home in 2022 Will Resume Their Searches in 2023. Should You?
This was the headline of a recent article published on 11/25/22 by Maurie Backman and I would like to share some of the highlights of his article.
- This year’s housing market has been tough for buyers.
- If you dropped out of the market this year, you may be thinking about picking back up next year.
- While we could see more inventory in 2023, we won’t necessarily see lower borrowing rates.
The reason so many buyers have given up on purchasing a home in the short term is due to the lack of inventory at the beginning of this year. More inventory has come on the market there are not enough listings to meet buyer demand.
To add to the inventory shortages, it’s gotten most expensive to secure a mortgage. In January of this year, mortgage rates were around 3% and have more than doubled as of this blog. Rates fluctuate every day but as of the posting of this blog a typical buyer could expect the 30 year fixed rate to be in the 6’s and 7’s depending on a number of variables like credit scores, down payments and the type of property you are purchasing.
According to a recent survey by HomeLight, 72% of buyers who dropped out of the housing market this year plan to try again in 2023. Here are some factors to consider if now is a good time for you to get back in the game.
Why 2023 may be a better time to buy a home
While inventory is still low, it might pick up in 2023, and once that happens, it should narrow the gap between real estate supply and buyer demand. This should result in lower prices.
Why 2023 may not be a better time to buy a home
Uncertainty in the direction of mortgage rates. If inventory increases and rates continue to rise borrowing will cost more thus making home loans even less affordable. Bottom line…….even if home prices drop in ‘23, higher cost of borrowing may mean that buyers won’t gain purchasing power.\
Should you plan to resume your home search in 2023?
If you’re in a strong position financially, then it could pay to pick up your home search in 2023 and see if there are more options to choose from. Granted, you might get stuck spending more on a mortgage, but remember, rates could easily drop over time. And once they do, you’ll have the option to refinance into a lower interest rate. On the other hand, if you’re not financially stable, or if you’re worried about losing your job in 2023, then you may want wait a bit longer. It’s important to be fully secure in your finances before taking the leap into home-ownership. If you have any doubts at all, your best bet is really to sit tight, shore up your savings, and wait until you feel more stable job-wise. You may not reach that point in 2023, and that’s okay. It’s better to buy a home when you truly feel confident in your ability to manage it. And if that doesn’t happen until 2024 or even beyond, so be it.
If you have any questions about purchasing a new home or refinancing your existing home, please give me a call at 855-56-DAVID which is 855-536-2843 or send me an email at firstname.lastname@example.org