November 18, 2022
The last weeks of the old year usually bring speculation about what the next year will bring, especially in terms of the economy and the real estate market.
Housing market issues were a serious concern in 2022. In the wake of this year’s rising mortgage rates and house prices; what are finance blogs and market watchers saying about what’s next in 2023?
Many finance websites report a general expectation that rates and house prices may improve in the new year.
But the degree of that improvement is what’s at issue. Some feel big changes are coming (compared to current conditions) while others feel those gains could be more modest.
The National Association of Realtors are on record saying 2023 may see mortgage rates hover between 6% and 7%. There will be some variation depending on the type of home loan and other factors.
That’s not a big improvement over what we’re seeing in 2022. That said? Other sources believe the new year may include more dramatic changes.
The Mortgage Bankers Association (MBA) has been quoted noting that mortgage rates could potentially fall below 5.5%.
However, the MBA has also been quoted saying there’s a possibility of mortgage rate volatility in the new year and that means it could be a rocky ride getting to the five percent zone.
Is it worth it to buy a home in 2023? The going advice seems to be against waiting for mortgage loan interest rates to improve.
And that notion makes sense–there’s just no way to know when that may happen and few borrowers plan to buy a home with an indefinite timeline, which is what you could be subject to if you start planning but decide to see how long it takes for rates to fall back to a more affordable level.
It’s better to save your down payment, make your plans, and proceed and see where the interest rates are when you feel ready to commit.
If you plan to keep the home long-term? Consider talking to a participating FHA lender about purchasing interest rate discount points, or ask about an FHA Adjustable-Rate Mortgage (FHA ARM).
Everyone in the housing industry is wondering about what’s to come in the new year. 2023 may not be the perfect time to purchase property for some, but don’t feel that you can’t move toward your goals even with higher rates.
Current conditions won’t last forever and as the market improves overall, your options may look more affordable in the new year.