THE LONG-TERM BENEFIT OF HOMEOWNERSHIP Today’s cooling housing market, the rise in mortgage rates, and mounting economic concerns have some people questioning: should I still buy a home this year? While it’s true this year has unique challenges for homebuyers, it’s important to factor the long-term benefits of homeownership into your decision. Consider this: if you know people who bought a home 5, 10, or even 30 years ago, you’re probably going to have a hard time finding someone who regrets their decision. Why is that? The reason is tied to how you gain equityand wealth as home values grow with time. The National Association of Realtors (NAR) explains: “Home equity gains are built up through price appreciation and by paying off the mortgage through principal payments.” Here’s a look at how just the home price appreciation piece can really add up over the years. Home Price Growth Over Time Even though home price appreciation has moderated this year, home values have still increased significantly in recent years. The map below uses data from the Federal Housing Finance Agency (FHFA) to show just how noteworthy those gains have been over the last five years. If you look at the percent change in home prices, you can see home prices grew on average by almost 64% nationwide over that period.  That means a home’s value can increase substantially in a short time. And if you expand that time frame even more, the benefit of homeownership and the drastic gains you stand to make become even clearer (see map below): The second map shows, nationwide, home prices appreciated by an average of over 290% over roughly a thirty-year span. While home price growth varies by state and local area, the nationwide average tells you the typical homeowner who bought a house thirty years ago saw their home almost triple in value over that time. This is why homeowners who bought their homes years ago are still happy with their decision. Even if home price appreciation eases as the market cools this year, experts say home prices are still expected to appreciate nationally in 2023. That means, in most markets, your home should grow in value over the next year even if the pace is slower than it was during the peak market frenzy when prices skyrocketed. The alternative to buying a home is renting, and rental prices have been climbing for decades. So why rent and fight annual lease hikes for no long-term financial benefit? Instead, consider buying a home. It’s an investment in your future that could set you up for long-term gains. BOTTOM LINE Don’t let the shifting market delay your dreams. Data shows home values typically appreciate over time, and that gives your net worth a nice boost. If you’re ready to start your journey to homeownership, let’s connect today.

DO YOU BELIEVE HOMEOWNERSHIP IS OUT OF REACH? MAYBE IT DOESN’T HAVE TO BE. It turns out, millennials aren’t the renter generation after all. The 2022 Consumer Insights Report from Mynd says there’s a portion of millennial and Gen Z buyers who are pursuing homeownership as a way to build their wealth, but it may not be exactly the way previous generations have done it. The study explains how they’re breaking into the market: “. . . younger generations of Americans are not buying into that dream in the same way that older generations have. A growing number of Americans are choosing to make their first real estate purchase as an investment property.” Instead of buying a home and moving into it themselves, some young buyers are purchasing a home so they can use it as a rental. This tactic may be gaining popularity, at least in part, because of the affordability challenges brought about by today’s higher mortgage rates. The report above mentions how many people in this group are considering this approach. It says: “Almost half of Millennials and Gen Z (43%) are considering buying an investment property compared to only 9% of Baby Boomers and 27% of Gen X.” Why Younger Buyers Are Buying a Home To Use as a Rental This strategy allows buyers to continue living in their current location, like the bustle of a city apartment or a neighborhood that they know and love, where they couldn’t afford to buy. But instead of giving up on the idea of owning a home, they buy a home in a more affordable area with the intention of renting it out. In a way, they’re getting the best of both worlds. They live where they want, and they still own a home where they can afford it. Their goal is to generate passive income and diversify their assets. It works like this: in addition to having a rental stream of income, the equity they build in their house will also help grow their net worth over time. BOTTOM LINE If you’re thinking about buying a home as an investment strategy to build your wealth, let’s connect to explore your options and nearby areas that may have homes that fit what you’re looking for.

WHAT’S AHEAD FOR MORTGAGE RATES AND HOME PRICES? Now that the end of 2022 is within sight, you may be wondering what’s going to happen in the housing market next year and what that may mean if you’re thinking about buying a home. Here’s a look at the latest expert insights on both mortgage rates and home prices so you can make your best move possible. Mortgage Rates Will Continue To Respond to Inflation There’s no doubt mortgage rates have skyrocketed this year as the market responded to high inflation. The increases we’ve seen were fast and dramatic, and the average 30-year fixed mortgage rate even surpassed 7% at the end of last month. In fact, it’s the first time they’ve risen this high in over 20 years (see graph below): In their latest quarterly report, Freddie Mac explains just how fast the climb in rates has been: “Just one year ago, rates were under 3%. This means that while mortgage rates are not as high as they were in the 80’s, they have more than doubled in the past year. Mortgage rates have never doubled in a year before.” Because we’re in unprecedented territory, it’s hard to say with certainty where mortgage rates will go from here. Projecting the future of mortgage rates is far from an exact science, but experts do agree that, moving forward, mortgage rates will continue to respond to inflation. If inflation stays high, mortgage rates likely will too. Home Price Changes Will Vary by Market As buyer demand has eased this year in response to those higher mortgage rates, home prices have moderated in many markets too. In terms of the forecast for next year, expert projections are mixed. The general consensus is home price appreciation will vary by local market, with more significant changes happening in overheated areas. As Mark Fleming, Chief Economist at First American, says: “House price appreciation has slowed in all 50 markets we track, but the deceleration is generally more dramatic in areas that experienced the strongest peak appreciation rates.” Basically, some areas may still see slight price growth while others may see slight price declines. It all depends on other factors at play in that local market, like the balance between supply and demand. This may be why experts are divided on their latest national forecasts (see graph below): BOTTOM LINE If you want to know what’s happening with home prices or mortgage rates, let’s connect so you have the latest on what experts are saying and what that means for our area.

SELL YOUR HOUSE BEFORE THE HOLIDAYS As you look ahead to the winter season, you’re likely making plans and thinking about what you want to achieve before the year ends. One of those key decision points could be whether or not you want to move this year. If the location or size of your current home no longer meets your needs, finding a house that better suits your lifestyle may be a top priority for you. But with today’s cooling housing market, is it really a good time to sell your house, or should you wait? If you’re ready to make your decision, here are three reasons you may want to consider selling before the holidays. 1. Get One Step Ahead of Other Sellers Typically, in the residential real estate market, homeowners are less likely to list their houses toward the end of the year. That’s because people get busy around the holidays and deprioritize selling their house until the start of the new year when their schedules and social calendars calm down. Selling now, while other homeowners may hold off until after the holidays, can help your house stand out. Start the process with a real estate professional today so you can get your house on the market and get ahead of your competition. 2. Get in Front of Serious Buyers This Season Even though housing supply has increased this year as buyer demand has moderated, it’s still low overall. That means there aren’t enough homes on the market today, especially as the millennial generation reaches their peak homebuying years. As Mark Fleming, Chief Economist at First American, says: “While not the frenzy of 2021, the largest living generation, the Millennials, will continue to age into their prime home-buying years, creating a demographic tailwind for the housing market.” Serious buyers will still be looking this winter and your house may be exactly what they’re searching for. If you work with an agent to list your house now, you’ll be able to get in front of the eager buyers who are hoping to make a move before the year ends. 3. Seize a Great Chance To Move Up Don’t forget, today’s homeowners have record amounts of equity. According to CoreLogic, the average amount of equity per mortgage holder has climbed to almost $300,000. That’s an all-time high. That means the equity you have in your house right now could cover some, if not all, of a down payment on the home of your dreams. And as you weigh the reasons to sell before winter, don’t lose sight of why you’re thinking about moving in the first place. Maybe it’s time to buy a house that’s in a better location for you, has the space you and your loved ones have been craving, or simply gives you that sense of home. A trusted real estate advisor can help you determine how much home equity you have and how you can use it to achieve your goal of making a move. BOTTOM LINE If you’re thinking about selling your house so you can find a home that better suits your needs, don’t delay your plans. Let’s connect so you can accomplish your goals before winter.

HOME EQUITY: A SOURCE OF STRENGTH FOR HOMEOWNERS TODAY Experts agree there’s no chance of a large-scale foreclosure crisis like we saw back in 2008, and that’s good news for the housing market. As Mark Fleming, Chief Economist at First American, says: “. . . don’t expect a housing bust like the mid-2000s, as lending standards in this housing cycle have been much tighter and homeowners have historically high levels of home equity, so there likely won’t be a surge in foreclosures.” Data from the Mortgage Bankers Association (MBA) helps tell this story. It shows the overall percentage of homeowners at risk is decreasing significantly with time (see graph below): But even though the volume of homeowners at risk is very low, there is still a small percentage of homeowners who may be coming face to face with foreclosure as a possibility today. If you’re facing difficulties yourself, it can help to understand your options. It starts with knowing what foreclosure is. Investopedia defines it like this: “Typically, default is triggered when a borrower misses a specific number of monthly payments . . . Foreclosure is the legal process by which a lender attempts to recover the amount owed on a defaulted loan by taking ownership of and selling the mortgaged property.” The good news is there are alternatives available to help you avoid going through the foreclosure process, including: Reinstatement Loan modification Deed-in-lieu of foreclosure Short sale But before you go down any of those paths, it’s worth seeing if you have enough equity in your home to sell it and protect your investment. You May Be Able To Use Your Equity To Sell Your House Equity is the difference between what you owe on the home and its market value based on factors like price appreciation. In today’s real estate market, many homeowners have far more equity in their homes than they realize due to the home price appreciation we’ve seen over the past few years. According to CoreLogic: “The total average equity per borrower has now reached almost $300,000, the highest in the data series.” So, what does that mean for you? If you’ve lived in your house for at least a few years or more, chances are your home’s value, and your equity, has risen dramatically. In addition, the mortgage payments you’ve made during that time chipped away at the balance of your loan. If your home’s current value is higher than what you still owe on your loan, you may be able to use that increase to your advantage. Rick Sharga, Executive VP of Market Intelligence at ATTOM Data, explains how equity can help: “Very few of the properties entering the foreclosure process have reverted to the lender at the end of the foreclosure. . . We believe that this may be an indication that borrowers are leveraging their equity and selling their homes rather than risking the loss of their equity in a foreclosure auction.” Lean on Experts To Explore Your Options To find out how much equity you have, work with a local real estate professional. They can give you an estimate of what your house could sell for based on recent sales of similar homes in your area. You may be able to sell your house to avoid foreclosure. If you find out you have to pursue other options, your agent can help with that too. They’ll be able to connect you with other professionals in the industry, like housing counselors, who can look into your unique situation and offer advice on next steps if selling isn’t your best alternative. BOTTOM LINE If you’re a homeowner facing hardship, let’s connect so you have an expert on your side to explore your options and see if you can sell your house to avoid foreclosure.

TOP QUESTIONS ABOUT SELLING YOUR HOME THIS WINTER There’s no denying the housing market is undergoing a shift this season, and that may leave you with some questions about whether it still makes sense to sell your house. Here are three of the top questions you may be asking – and the data that helps answer them – so you can make a confident decision. 1. Should I Wait To Sell? Even though the supply of homes for sale has increased in 2022, inventory is still low overall. That means it’s still a sellers’ market. The graph below helps put the inventory growth into perspective. Using data from the National Association of Realtors (NAR), it shows just how far off we are from flipping to a buyers’ market: While buyers have regained some negotiation power as inventory has grown, you haven’t missed your window to sell. Your house could still stand out since inventory is low, especially if you list now while other sellers hold off until after the holiday rush and the start of the new year. 2. Are Buyers Still Out There? If you’re thinking of selling your house but are hesitant because you’re worried buyer demand has disappeared in the face of higher mortgage rates, know that isn’t the case for everyone. While demand has eased this year, millennials are still looking for homes. As an article in Forbes explains: “At about 80 million strong, millennials currently make up the largest share of homebuyers (43%) in the U.S., according to a recent National Association of Realtors (NAR) report. Simply due to their numbers and eagerness to become homeowners, this cohort is quite literally shaping the next frontier of the homebuying process. Once known as the ‘rent generation,’ millennials have proven to be savvy buyers who are quite nimble in their quest to own real estate. In fact, I don’t think it’s a stretch to say they are the key to the overall health and stability of the current housing industry.” While the millennial generation has been dubbed the renter generation, that namesake may not be appropriate anymore. Millennials, the largest generation, are actually a significant driving force for buyer demand in the housing market today. If you’re wondering if buyers are still out there, know that there are still people who are searching for a home to buy today. And your house may be exactly what they’re looking for. 3. Can I Afford To Buy My Next Home? If current market conditions have you worried about how you’ll afford your next move, consider this: you may have more equity in your current home than you realize. Homeowners have gained significant equity over the past few years and that equity can make a big difference in the affordability equation, especially with mortgage rates higher now than they were last year. According to Mark Fleming, Chief Economist at First American: “. . . homeowners, in aggregate, have historically high levels of home equity. For some of those equity-rich homeowners, that means moving and taking on a higher mortgage rate isn’t a huge deal—especially if they are moving to a more affordable city.”  BOTTOM LINE If you’re thinking about selling your house this season, let’s connect so you have the expert insights you need to make the best possible move today.

HOW OWNING A HOME BUILDS YOUR NET WORTH Owning a home is a major financial milestone and an achievement to take pride in. One major reason: the equity you build as a homeowner gives your net worth a big boost. And with high inflation right now, the link between owning your home and building your wealth is especially important. If you’re looking to increase your financial security, here’s why now could be a good time to start on your journey toward homeownership. Owning a Home Is a Key Ingredient for Financial Success A report from the National Association of Realtors (NAR) details several homeownership trends, including a significant gap in net worth between homeowners and renters. It finds: “. . . the net worth of a homeowner was about $300,000 while that of a renter’s was $8,000 in 2021.” To put that into perspective, the average homeowner’s net worth is roughly 40 times that of a renter’s. This difference shows owning a home is a key step in achieving financial success. Equity Gains Can Substantially Boost a Homeowner’s Net Worth The net worth gap between owners and renters exists in large part because homeowners build equity. When you own a home, your equity grows as your home appreciates in value and you make your mortgage payments each month. As a renter, you don’t have that same opportunity. A recent article from CNET explains: “Homeownership is still considered one of the most reliable ways to build wealth. When you make monthly mortgage payments, you’re building equity in your home . . . When you rent, you aren’t investing in your financial future the same way you are when you’re paying off a mortgage.” But on top of that, your home equity grows even more as your home appreciates in value over time. That has a major impact on the wealth you build, as a recent article from Bankrate notes: “Building home equity can help you increase your wealth over time, . . . A home is one of the only assets that have the potential to appreciate in value as you pay it down.” In other words, when you own your home, you have the advantage of your mortgage payment acting as a contribution to a forced savings account that grows in value as your home does. And when you sell, any equity you’ve built up comes back to you. As a renter, you’ll never see a return on the money you pay out in rent every month. BOTTOM LINE Owning a home is an important part of building your net worth. If you’re ready to start on your journey to homeownership, let’s connect today.

YOUR HOUSE COULD BE THE #1 ITEM ON A HOMEBUYER’S WISH LIST DURING THE HOLIDAYS Each year, homeowners planning to make a move are faced with a decision: sell their house during the holidays or wait. And others who have already listed their homes may think about removing their listings and waiting until the new year to go back on the market. The truth is many buyers want to purchase a home for the holidays, and your house might be just what they’re looking for. Here are five great reasons you shouldn’t wait to sell your house. 1. While the supply of homes for sale has increased this year, there still aren’t enough homes on the market to keep up with buyer demand. As Nadia Evangelou, Senior Economist & Director of Forecasting at the National Association of Realtors (NAR), explains: “There’s still this gap between demand and supply because we were underbuilding for many years. . . . So now we see demand is slowing, but it still outpaces supply.” 2. Serious homebuyers are out looking right now. Millennials are driving homebuying demand today, and many are eager to make a purchase. Mark Fleming, Chief Economist at First American, explains: “While not the frenzy of 2021, the largest living generation, the Millennials, will continue to age into their prime home-buying years, creating a demographic tailwind for the housing market.” 3. The desire to own a home doesn’t stop during the holidays. In fact, homes decorated for the holidays appeal to many buyers. Plus, purchasers who look for homes during the holidays are ready to buy. 4. You can restrict the showings in your house to days and times that are most convenient for you. That can help you minimize disruptions, which is especially important this time of year. 5. Rents have skyrocketed in recent years. And, many buyers are looking to escape rising rents and avoid falling into the rental trap for another year. As an article from Zillow says: “Over the next 12 months, rents are expected to grow more than inflation, the stock market and home values.” Your home could be their ticket to leaving renting behind for good. BOTTOM LINE There are still many reasons it makes sense to list your house during the holiday season. Let’s connect to determine if selling now is your best move.

HOMEOWNERSHIP IS AN INVESTMENT IN YOUR FUTURE There are many people thinking about buying a home, but with everything affecting the economy, some are wondering if it’s a smart decision to buy now or if it makes more sense to wait it out. As Bob Broeksmit, President and CEO of the Mortgage Bankers Association (MBA), explains: “The desire for homeownership is strong. Many prospective buyers are waiting for the volatility in mortgage rates to subside, as well as for a clearer picture of the economic outlook.” If you’re in that position, remember that it’s important to consider not just what’s happening today but also what benefits you may gain in the long run. There’s a lot of information out there about how homeownership helps build a homeowner’s net worth over time. But even today, many people think first about things like 401(k)s before they think of owning a home as a wealth-building tool. It’s especially important if you’re a young prospective homebuyer to understand how homeownership is another key way to invest in your future. An article from Bloomberg notes: “Millennials have higher average 401(k) balances than Generation X did when they were the same age, but they’re not any better off financially. . . . A lot of that has to do with being less likely to own a home.” To help you understand just how much owning a home can have a positive impact on your life over the years, take a look at what the data shows. The same Bloomberg article helps show the gap in wealth between renters and homeowners who are 65 years and older (see graph below). The difference is substantial, even when incomes are similar. So, if you want to create wealth to help set you up for success later on, it may be time to prioritize homeownership. That’s because, whether you decide to rent or buy a home, you’ll have a monthly housing expense either way. The question is: are you going to invest in yourself and your future, or will you help someone else (your landlord) increase their wealth? BOTTOM LINE Before putting your homeownership plans on hold, let’s connect to go over your options. That way, you’ll have expert advice on how to make the best decision right now and the best investment in your future.

WHAT EVERY SELLER SHOULD KNOW ABOUT HOME PRICES If you’re trying to decide whether or not to sell your house, recent headlines about home prices may be top of mind. And if those stories have you wondering what that means for your home’s value, here’s what you really need to know. What’s Really Happening with Home Prices? It’s possible you’ve seen news stories mentioning a drop in home values or home price depreciation, but it’s important to remember those headlines are designed to make a big impression in just a few words. But what headlines aren’t always great at is painting the full picture. While home prices are down slightly month-over-month in some markets, it’s also true that home values are up nationally on a year-over-year basis. The graph below uses the latest data from S&P Case-Shiller to help tell the story of what’s actually happening in the housing market today: As the graph shows, it’s true home price growth has moderated in recent months (shown in green) as buyer demand has pulled back in response to higher mortgage rates. This is what the headlines are drawing attention to today. But what’s important to notice is the bigger, longer-term picture. While home price growth is moderating month-over-month, the percent of appreciation year-over-year is still well above the home price change we saw during more normal years in the market. The bars for January 2019 through mid-2020 show home price appreciation around 3-4% a year was more typical (see bars for January 2019 through mid-2020). But even the latest data for this year shows prices have still climbed by roughly 10% over last year. What Does This Mean for Your Home’s Equity? While you may not be able to capitalize on the 20% appreciation we saw in early 2022, in most markets your home’s value, on average, is up 10% over last year – and a 10% gain is still dramatic compared to a more normal level of appreciation (3-4%). The big takeaway? Don’t let the headlines get in the way of your plans to sell. Over the past two years alone, you’ve likely gained a substantial amount of equity in your home as home prices climbed. Even though home price moderation will vary by market moving forward, you can still use the boost your equity got to help power your move. As Mark Fleming, Chief Economist at First American, says: “Potential home sellers gained significant amounts of equity over the pandemic, so even as affordability-constrained buyer demand spurs price declines in some markets, potential sellers are unlikely to lose all that they have gained.” BOTTOM LINE If you have questions about home prices or how much equity you have in your current home, let’s connect so you have an expert’s advice.

HOMEOWNERS STILL HAVE POSITIVE EQUITY GAINS OVER THE PAST 12 MONTHS If you’re a homeowner, your net worth got a big boost over the past few years thanks to rapidly rising home prices. Here’s how it happened and what it means for you, even as the market moderates. Equity is the current value of your home minus what you owe on the loan. Because there was a significant imbalance between the number of homes available for sale and the number of buyers looking to make a purchase over the past few years, home prices appreciated substantially. And while home price appreciation has moderated this year, and even depreciated slightly in some overheated markets, that doesn’t mean you’ve lost all the equity you gained during the pandemic frenzy. To prove you still have equity you can use, the latest Homeowner Equity Insights from CoreLogic finds the average homeowner equity has actually grown by $34,300 over the past 12 months. That’s right, despite the headlines, the average homeowner still gained positive equity over the last year in just about every market. While the gains aren’t as dramatic as they were in the previous quarter due to home price moderation, they’re still significant. And if you’ve been in your home for longer than a year, chances are you have even more equity than you realize. While that’s the national number, if you want to know what happened over the past year in your area, look at the map below from CoreLogic: Why This Is So Important Right Now While equity helps increase your overall net worth, it can also help you achieve other goals, like buying your next home. When you sell your current house, the equity you’ve built up comes back to you in the sale, and it may be just what you need to cover a large portion – if not all – of the down payment on your next home. So, if you’ve been holding off on selling because you weren’t sure what the headlines meant for your bottom line, rest assured you’ve still gained equity in recent years, and it can help fuel your move. BOTTOM LINE If you’re planning to make a move, the equity you’ve gained over time can make a big impact. To find out just how much equity you have in your current home and how you can use it to fuel your next purchase, let’s connect.

CONFUSED ABOUT WHAT’S GOING ON IN THE HOUSING MARKET? LEAN ON A PROFESSIONAL. If you’re thinking about buying or selling a home, you probably want to know what’s really happening with home prices, mortgage rates, housing supply, and more. That’s not an easy task considering how sensationalized headlines are today. Jay Thompson, Real Estate Industry Consultant, explains: “Housing market headlines are everywhere. Many are quite sensational, ending with exclamation points or predicting impending doom for the industry. Clickbait, the sensationalizing of headlines and content, has been an issue since the dawn of the internet, and housing news is not immune to it.” Unfortunately, when information in the media isn’t clear, it can generate a lot of fear and uncertainty in the market. As Jason Lewris, Cofounder and Chief Data Officer at Parcl, says: “In the absence of trustworthy, up-to-date information, real estate decisions are increasingly being driven by fear, uncertainty, and doubt.” But it doesn’t have to be that way. Buying or selling a home is a big decision, and it should be one you feel confident making. To help you separate fact from fiction and get the answers you need, lean on a local real estate advisor. A trusted expert is your best resource to understand what’s happening at the national and local levels. They’ll be able to debunk the headlines using data you can trust. And using their in-depth knowledge of the industry, they’ll provide context so you know how current trends compare to the normal ebbs and flows in the industry, historical data and more. Then, to make sure you have the full picture, they’ll tell you if your local area is following the national trend or if they’re seeing something different in your market. Together, you’ll use all of that information to make the best possible decision for you. After all, making a move is a potentially life-changing milestone. It should be something you feel ready for and excited about. And that’s where an agent comes in. BOTTOM LINE If you have questions about the headlines or what’s happening in the housing market today, let’s connect so you have expert insights and advice on your side.

WHAT TO EXPECT FROM THE HOUSING MARKET IN 2023 The 2022 housing market has been defined by two key things: inflation and rapidly rising mortgage rates. And in many ways, it’s put the market into a reset position. As the Federal Reserve (the Fed) made moves this year to try to lower inflation, mortgage rates more than doubled – something that’s never happened before in a calendar year. This had a cascading impact on buyer activity, the balance between supply and demand, and ultimately home prices. And as all those things changed, some buyers and sellers put their plans on hold and decided to wait until the market felt a bit more predictable. But what does that mean for next year? What everyone really wants is more stability in the market in 2023. For that to happen we’ll need to see the Fed bring inflation down even more and keep it there. Here’s what housing market experts say we can expect next year. What’s Ahead for Mortgage Rates in 2023? Moving forward, experts agree it’s still going to be all about inflation. If inflation is high, mortgage rates will be as well. But if inflation continues to fall, mortgage rates will likely respond. While there may be early signs inflation is easing as we round out this year, we’re not out of the woods just yet. Inflation is still something to watch in 2023. Right now, experts are factoring all of this into their mortgage rate forecasts for next year. And if we average those forecasts together, experts say we can expect rates to stabilize a bit more in 2023. Whether that’s between 5.5% and 6.5%, it’s hard for experts to say exactly where they’ll land. But based on the average of their projections, a more predictable rate is likely ahead (see chart below): That means, we’ll start the year out about where we are right now. But we could see rates tick down if inflation continues to drop. As Greg McBride, Chief Financial Analyst at Bankrate, explains: “. . . mortgage rates could pull back meaningfully next year if inflation pressures ease.” In the meantime, expect some volatility as rates will likely fluctuate in the weeks ahead. If we see inflation come back under control, that would be good news for the housing market. What Will Happen to Home Prices Next Year? Homes prices will always be defined by supply and demand. The more buyers and fewer homes there are on the market, the more home prices will rise. And that’s exactly what we saw during the pandemic. But this year, things changed. We’ve seen home prices moderate and housing supply grow as buyer demand pulled back due to higher mortgage rates. The level of moderation has varied by local area – with the biggest changes happening in overheated markets. But do experts think that will continue? The graph below shows the latest home price forecasts for 2023. As the different colored bars indicate, some experts are saying home prices will appreciate next year, and others are saying home prices will come down. But again, if we take the average of all the forecasts (shown in green), we can get a feel for what 2023 may hold. The truth is probably somewhere in the middle. That means nationally, we’ll likely see relatively flat or neutral appreciation in 2023. As Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), says: “After a big boom over the past two years, there will essentially be no change nationally . . . Half of the country may experience small price gains, while the other half may see slight price declines.” BOTTOM LINE The 2023 housing market is going to be defined by mortgage rates, and rates will be determined by what happens with inflation. The best way to keep a pulse on what experts are projecting for next year is to lean on a trusted real estate advisor. Let’s connect.

WHAT EXPERTS ARE SAYING ABOUT THE 2023 HOUSING MARKET If you’re thinking about buying or selling a home soon, you probably want to know what you can expect from the housing market this year. In 2022, the market underwent a major shift as economic uncertainty and higher mortgage rates reduced buyer demand, slowed the pace of home sales, and moderated home prices. But what about 2023? An article from HousingWire offers this perspective: “The red-hot housing market of the past 2 ½ years was characterized by sub-three percent mortgage rates, fast-paced bidding wars and record-low inventory. But more recently, market conditions have done an about-face. . . . now is the opportunity for everyone to become re-educated about what a ‘typical’ housing market looks like.” This year, experts agree we may see the return of greater stability and predictability in the housing market if inflation continues to ease and mortgage rates stabilize. Here’s what they have to say. The 2023 forecast from the National Association of Realtors (NAR) says: “While 2022 may be remembered as a year of housing volatility, 2023 likely will become a year of long-lost normalcy returning to the market, . . . mortgage rates are expected to stabilize while home sales and prices moderate after recent highs, . . .” Danielle Hale, Chief Economist at realtor.com, adds: “. . . buyers will not face the extreme competition that was commonplace over the past few years.” Lawrence Yun, Chief Economist at NAR, explains home prices will vary by local area, but will net neutral nationwide as the market continues to adjust: “After a big boom over the past two years, there will essentially be no change nationally . . . Half of the country may experience small price gains, while the other half may see slight price declines.” Mark Fleming, Chief Economist at First American, says: “The housing market, once adjusted to the new normal of higher mortgage rates, will benefit from continued strong demographic-driven demand relative to an overall, long-run shortage of supply.”  BOTTOM LINE If you’re looking to buy or sell a home this year, the best way to ensure you’re up to date on the latest market insights is to partner with a trusted real estate advisor. Let’s connect. If you’re thinking about buying or selling a home soon, you probably want to know what you can expect from the housing market this year. In 2022, the market underwent a major shift as economic uncertainty and higher mortgage rates reduced buyer demand, slowed the pace of home sales, and moderated home prices. But what about 2023? An article from HousingWire offers this perspective: “The red-hot housing market of the past 2 ½ years was characterized by sub-three percent mortgage rates, fast-paced bidding wars and record-low inventory. But more recently, market conditions have done an about-face. . . . now is the opportunity for everyone to become re-educated about what a ‘typical’ housing market looks like.” This year, experts agree we may see the return of greater stability and predictability in the housing market if inflation continues to ease and mortgage rates stabilize. Here’s what they have to say. The 2023 forecast from the National Association of Realtors (NAR) says: “While 2022 may be remembered as a year of housing volatility, 2023 likely will become a year of long-lost normalcy returning to the market, . . . mortgage rates are expected to stabilize while home sales and prices moderate after recent highs, . . .” Danielle Hale, Chief Economist at realtor.com, adds: “. . . buyers will not face the extreme competition that was commonplace over the past few years.” Lawrence Yun, Chief Economist at NAR, explains home prices will vary by local area, but will net neutral nationwide as the market continues to adjust: “After a big boom over the past two years, there will essentially be no change nationally . . . Half of the country may experience small price gains, while the other half may see slight price declines.” Mark Fleming, Chief Economist at First American, says: “The housing market, once adjusted to the new normal of higher mortgage rates, will benefit from continued strong demographic-driven demand relative to an overall, long-run shortage of supply.”  BOTTOM LINE If you’re looking to buy or sell a home this year, the best way to ensure you’re up to date on the latest market insights is to partner with a trusted real estate advisor. Let’s connect.

THINK TWICE BEFORE WAITING FOR 3% MORTGAGE RATES Last year, the Federal Reserve took action to try to bring down inflation. In response to those efforts, mortgage rates jumped up rapidly from the record lows we saw in 2021, peaking at just over 7% last October. Hopeful buyersexperienced a hit to their purchasing power as a result, and some decided to press pause on their plans. Today, the rate of inflation is starting to drop. And as a result, mortgage rates have dipped below last year’s peak. Sam Khater, Chief Economist at Freddie Mac, shares: “While mortgage market activity has significantly shrunk over the last year, inflationary pressures are easing and should lead to lower mortgage rates in 2023.” That’s potentially great news if you’re a buyer aiming to jump back into the housing market. Any drop in mortgage rates helps boost your purchasing power by bringing down your expected monthly mortgage payment. This means the lower mortgage rates experts forecast this year could be just what you need to reignite your homebuying goals. While this opens up a window of opportunity for you, remember: you shouldn’t expect rates to drop back down to record lows like we saw in 2021. Experts agree that’s not the range buyers should bank on. Greg McBride, Chief Financial Analyst at Bankrate, explains: “I think we could be surprised at how much mortgage rates pull back this year. But we’re not going back to 3 percent anytime soon, because inflation is not going back to 2 percent anytime soon.” It’s important to have a realistic vision for what you can expect this year, and that’s where the advice of expert real estate advisors is critical. You may be surprised by the impact even a mild drop in mortgage rates has on your budget. If you’re ready to buy a home now, today’s market presents the opportunity to get a more affordable mortgage rate, find your dream home, and face less competition from other buyers. BOTTOM LINE The recent pullback in mortgage rates is great news – but if you’re ready to buy now, holding out for 3% is a mistake. Work with a local lender to learn how today’s rates impact your goals, and let’s connect to explore your options in our area.

WANT TO SELL YOUR HOUSE? PRICE IT RIGHT. Last year, the housing market slowed down in response to higher mortgage rates, and that had an impact on home prices. If you’re thinking of selling your house soon, that means you’ll want to adjust your expectations accordingly. As realtor.com explains: “. . . some of the more prominent pandemic trends have changed, so sellers might wish to adjust accordingly to get the best deal possible.” In a more moderate market, how you price your house will make a big difference to not only your bottom line, but to how quickly your house could sell. And the reality is, homes priced right are still selling in today’s market. Why Pricing Your House Appropriately Matters Especially today, your asking price sends a message to potential buyers. If it’s priced too low, you may leave money on the table or discourage buyers who may see a lower-than-expected price tag and wonder if that means something is wrong with the home. If it’s priced too high, you run the risk of deterring buyers. When that happens, you may have to lower the price to try to reignite interest in your house when it sits on the market for a while. But be aware that a price drop can be seen as a red flag by some buyers who will wonder what that means about the home. To avoid either headache, price it right from the start. A real estate professional knows how to determine that ideal asking price. They balance the value of homes in your neighborhood, current market trends, buyer demand, the condition of your house, and more to find the right price. This helps lead to stronger offers and a greater likelihood your house will sell quickly. The visual below helps summarize the impact your asking price can have: BOTTOM LINE Homes that are priced at current market value are selling. To make sure you price your house appropriately, maximize your sales potential, and minimize your hassle, let’s connect.