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Should I wait until 2023 to buy a home? Experts weigh in on the future of the housing market

Redfin Layoffs
Posted at 12:07 PM, Dec 01, 2022
and last updated 2022-12-01 15:07:28-05

Home prices are expected to continue increasing in 2023, according to new analysis from Realtor.com.

But we shouldn't expect the big increases we saw earlier this year.

“Even though mortgage rates are high, and it's making buying a home very unaffordable, and rents are going up as well, there is still more people in the market for a place to live than there are places to live to go around, and that's what's keeping prices so high right now,” said Clare Trapasso with Realtor.com.

Mortgage interest rates are also expected to stay high. Realtor.com economists are predicting an average of 7.4 percent.

If you're in a position to buy now, expect less competition over the holidays.

“If someone spots a house that's been sitting on the market for a while, this is the time to go in, perhaps make an offer that's a little bit under the asking price and negotiate,” said Trapasso. “You need something repaired. Ask for it. You want the seller to contribute to closing costs or help buy down your mortgage rate. Now's the time to ask.”

With interest rates staying high, an adjustable-rate mortgage could be worth considering.

You'll be at a lower rate for a few years, and then it adjusts after that to what the current rate is, which will hopefully be lower.

“Right now, mortgage lenders are hurting for business,” Trapasso said. “So this is your time to negotiate. Go out there, do some research. Figure out, you know, where you can find a better rate and get it.”

Split payments could be something to consider for current homeowners to save money on their mortgage in the long run if the loan allows it.

Reatlor.com is predicting the average homeowner will see their equity rise by a little more than $25,000 next year.