Refin predicts that only 32 houses for every 1,000 homes listed in 2023 will sell!

“That’s fewer home sales than any year since 2011, when the U.S. was reeling from the subprime mortgage crisis, and a 30% decline from 2021 during the pandemic homebuying boom. It would also lead to the lowest housing-turnover rate since the early 1980s, with just 32 out of every 1,000 households selling their home in 2023.”

- Taylor Marr

Redfin

Here are some the main points they are predicting for 2023, or check out the full article yourself at https://www.redfin.com/news/housing-market-predictions-2023/

✅ Home sales are expected to fall to their lowest level in more than a decade in 2023.

✅ High mortgage rates and housing costs prevent people from moving.

✅ High homeowner equity and a resilient job market will prevent a wave of foreclosures.

✅ Mortgage rates will be high and make 2023 the slowest housing market year since 2011.

✅ Forecasts for mortgage rates, home sales, and home-sale prices account for a range of outcomes for inflation, employment, and other macroeconomic factors

✅ Expected 16% fewer existing home sales in 2023 than in 2022, landing at 4.3 million.

✅ 31% YoY decline in existing home sales in Q1, followed by smaller annual declines in Q2 and Q3

✅ Sales slowly start recovering as rates fall from their peak but will still have YoY declines for most of the year.

✅ 20% fewer sales of newly built homes, landing at about 500,000 nationwide

✅ Low demand and "lock-in" effect of homeowners with ultra-low mortgage rates staying put mean new listings will continue to decline YoY during H1 2023.

✅ Mortgage rates expected to gradually decline to around 5.8% by end of year, with the average 2023 homebuyer's rate at around 6.1%.

✅ Savings for homebuyers with $400,000 home with 6.5% rate compared to 5.8% rate is about $150/month.

✅ Home sales prices are expected to remain flat or decline slightly in 2023.

✅ New home construction to remain slow.

✅ Rental market to remain strong due to low homeownership rates and strong job market.

✅ Multifamily construction to pick up slightly.

✅ Homebuilders are expected to continue to reduce the construction of new homes in 2023, with YoY declines of roughly 25% in building permits and housing starts.

✅ Builders will reduce the construction of single-family homes, particularly in markets where they built too many homes in anticipation of demand that has failed to materialize.

✅ Construction of rental units, including apartments and multifamily houses, will be more financially viable for builders as rental demand will not fall off as much.

✅ Some construction spending will shift to remodels as people opt to renovate instead of the move due to high mortgage rates.

✅ Real estate investors will purchase about 25% fewer homes than in the previous year, with purchases expected to bottom out in the spring.

✅ If inflation slows and the Fed eases up on rate hikes, investors will likely start buying more homes in H2, taking advantage of slightly lower home prices.

✅ Gen Zers will seek jobs and apartments in relatively affordable mid-tier cities and may prioritize places with low costs of living or that offer incentives to remote workers.

✅ Migration from one part of the country to another will ease in 2023, with about 20% of Americans relocating from one metro to another, down from 24% in 2022

✅ Affordability challenges will continue to drive people to the suburbs and smaller cities, leading to growth in those areas.

✅ Homeownership rates among younger generations will remain low, but homeownership rates among seniors will continue to increase.

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