Typically, each year the spring market begins in earnest in
January with those early buyers trying to beat the spring rush
and wanting to move early. By April, the spring market peaks
when more buyers enter the home purchase game a little later
in the year but still want to move before summer vacation.
summer vacation.
The uncertainty of the economy and concerns about job
stability combined with the rise in interest rates have many
wondering how the real estate market will behave this year.
Some experts are predicting a completely different market
from the last two frenetic seller-biased years and that it could
be a more balanced market between sellers and buyers. While
higher interest rates and inflation reduce demand for homes,
inventory might still be relatively tight. Gen Z are entering
their peak home buying years, Millennials are still purchasing
their first and second homes, and Baby Boomers are aging in
place, staying in their homes longer. This low housing supply
continues to put pressure on our region and on the whole
country, which is already in short supply by 3 to 5 million units.
So even if unemployment rises, it looks like there will still be
enough housing demand, which makes it hard to believe we will
see massive price decreases. Will the market behave typically?
Many experts are expecting a flattening but not a declining
market. I suppose we will have to follow month by month how
the market performs this year and respond to it accordingly.
The Rise of Interest Rates
Those who need to move will keep moving. People move
for lifestyle reasons that have nothing to do with interest
rates. After all, life events that precipitate a move
still happen, including marriages, birth, promotions,
relocations, inheritance, divorces, and more. The
youngest kids graduate and become adults.
The average age of a person entering the housing
market is 22 to 34...life keeps moving. Families can delay
the decision for a while, but at some point, you just have
to take the leap and move when life demands it.
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