Homebuyer uncertainty is currently high right now and for good reason: Prices are at all-time highs, and rates are at 10-year highs. Along with a bumpy economic outlook, it’s understandable why some buyers are hesitant about purchasing a home.
But many financing experts, including Dave Ramsey, feel it’s still a good time to buy, if you are able to.
4 Reasons to Buy In 2023
There Are More Homes for Sale
Just a year earlier, the supply of housing was at record lows, resulting in extreme competition. Since then, housing inventory has grown, with 50% more homes on the market today.
Home Prices Are Not Seeing the Decline Many Thought Would Happen
If you’re waiting for prices to come down, think again. Collectively, the California housing market is seeing a slight rise in house and condo prices. Click here to view the California Housing Market Report.
Interest Rates Are Poised to Decline, Eventually!
“We’ve seen the highest mortgage rates we are likely to see for some time,” says Realtor.com® chief economist Danielle Hale, who expects mortgage rates to stabilize in the short term, and then begin dropping by late summer and early fall. “I don’t think we’ll see a fast decline from here, but rather a gradual easing.”
Homes Are Taking Longer to Sell (Great for New Buyers)
In the past few years, homes in hot markets were selling so fast, buyers couldn’t even see the place before it was snapped up. During the pandemic, one-third of new listings were under contract within a couple of days. In April 2022, homes spent an average of 49 days on the market, which is 17 days longer than in 2021.
The Reason for This Slowdown: Everyone is waiting and hoping for either interest rates to drop or home prices to go down. This means buyers need no longer rush into a deal out of desperation but can take their time to compare their options and negotiate a better deal. And with demand down, sellers are more flexible.
2 Reasons Not to Buy In 2023
You’re Maxing Out Your Budget
Inflation was still up 4.9% year over year in April of 2023, eating into homebuyers’ budgets. So, if mortgage rates have you stretched thin financially, then it might be best to wait and see if mortgage rates come down, or your income can be increased, before buying a new house.
Your Future Is Uncertain
The country is sitting in a relatively unpredictable economic situation at the moment, so if your own future is unclear and you don’t have to move, waiting might be the safer option—especially if you aren’t settled in your job or sure you plan to live in an area for more than a year or two.