Real Estate Made Simple

Tag: Home Sale

What to Expect for the Real Estate Market in 2023

The real estate market has changed drastically over the last few years. The pandemic brought a surge in demand for houses, followed by a freeze in the market as inflation and interest rates rose. That begs the question, what should we expect from the following year?

Most experts believe 2023 will bring a new semblance of normalcy. That means the market will settle down and return to more normal levels. Inflation should reduce or at least balance out, while interest rates will slow down. Let’s take a closer look at what to expect this year.

Housing Prices

Experts are quick to weigh in with their opinion on housing prices and values. Unfortunately, not all experts agree on this. For example, Realtor.com believes that housing prices will increase by another 5.4%, while Zelman believes the value will decrease by 5.1%. Ideally, these two extreme estimates will land in the middle, providing us with a stable market.

In other words, if we balance out the expert opinions on prices, it indicates little change. This means we’ll see a flat or neutral appreciation in 2023. This is good for sellers and buyers, as the market will not change drastically. 

Rate Lock-In Phenomenon

Mortgage rates hit a record low a couple of years ago, countering the current higher rates we’re seeing. This results in homeowners with a low rate (below 6% in most cases and below 4% in exceptional circumstances). That’s great for those homeowners, but they will unlikely consider selling their homes with an average mortgage above 6%. 

Homeowners are unwilling to give up their low mortgage rate in exchange for a higher interest rate. Some homeowners will sell regardless, either because of need or desire. But a large percentage will stay at their current home to wait out this shift.

Ironically, this is going to affect another market. Homeowners that wait out this shift may choose to work on home improvement projects. This will ultimately encourage a stronger contract market and increase home values – if done carefully. 

Reduction in Building

There will likely be a reduction in the number of homes built over the next year or two. Specifically, experts believe that builders will cut back on the number of new single-family homes they are constructing. Likewise, building permits will likely decline as homeowners settle in and wait for rates to change. 

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3 Home Renovations for a Faster Sale

When you know you’ll be selling your home a few months or years down the road, it’s a great idea to use this knowledge and make renovations now before the chaos of selling takes over your life. Certain renovations increase the value of your home more than others. If you want your home to sell shortly after being listed, consider prioritizing these upgrades over others.

New High-Quality Flooring

Old, outdated flooring will quickly turn off potential buyers. Carpet that’s peeling away or trodden down by foot traffic over the years makes your home look low value. Installing new floors is an instant way to completely transform the look of a home. Wood floors are a great choice: they look polished and have an estimated ROI of 70 to 80 percent. Another great option, particularly if you live where humidity levels are high, is ceramic tile. It’s pricier than wood but still offers an estimated ROI of 70 percent.

A State of the Art Kitchen

It’s common knowledge that the two most sought-after remodels involve the kitchen and master bathroom. The kitchen is what really sells a home however, and an overhaul can really shorten the length of time a home sits on the market. When remodeling the kitchen, try to keep things neutral. Granite countertops are still popular, as are tasteful backsplashes and white cabinets. Upgraded appliances bring the entire package together.

A Yard Built For Entertaining

A lifestyle that involves a lot of time spent outdoors is currently very sought after. Some people want to grow their own food. Others want more of an outdoor living room, a cozy spot where they can sit in comfort and entertain guests. Make sure your landscaping is on point and has a polished look to it if you want your home to stand out as a luxury home. Firepits, shady areas in which to sit, pools, and hot tubs are all great additions with high return rates.

These are some of the most lucrative home improvement ideas that will help you sell your home fast. It’s important to keep in mind that even with all the renovations in the world, your home still might not sell. Everything depends on your local real estate market. Still, these changes should make a home more likely to sell, anywhere in the country.

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