Mid-Year Market Update
The real estate industry is an ever-changing landscape where the future is difficult to predict. Whether you are a potential homebuyer, seller, or investor, staying informed about the latest developments is crucial for making informed decisions. Below are a few of the latest trends in the market as well as some predictions for the rest of the year.
Latest Trends
Steady Prices, Declining Sales
Median sale prices for homes in the U.S. have been consistent year-over-year and are currently around $516,000. However, the number of homes sold in April 2023 decreased by around 3.4% compared to April 2022. Low inventory and high interest rates are to blame for declining home sales, but nearly every area in the U.S. has experienced year-over-year declines.
Faster Sales
One sign that the market is currently healthy is that properties are spending fewer days on the market month over month. In March 2023, homes were on the market for a median of 54 days. That number dropped to 46 days in April and 43 days in May.
Balanced Market Conditions
The U.S. real estate market is gradually moving towards a more balanced state. While the market has favored sellers for several years, buyers are gaining more leverage in negotiations. The number of new listings has increased in recent months, offering buyers a wider range of options to choose from. Sellers should be prepared to price their properties competitively and consider strategies to make their listings stand out in the increasingly competitive market.
Predictions for Remainder of 2023
Steady Rates and Demand
Since interest rates remain high, it’s unlikely the market will change much in the coming months. The average interest rate for a 30-year mortgage is close to 7%. While many forecasts indicate that interest rates will start to drop soon and may reach close to 5% by the end of 2023, it will take significant movement to impact buyer demand by a substantial amount.
Demand for Affordability
Throughout the rest of 2023, there will be increased demand for affordable housing. The combination of stagnant wages and high living costs means that more buyers will be searching for homes that they can actually afford. However, these properties remain hard to come by.
Work From Home Dynamics
Remote work is still common across the country, meaning buyers will continue searching for large homes that offer ample space. Demand for larger, affordable homes will likely push buyers to purchase in rural and suburban areas. Even though there's slightly less demand for homes at the moment, home values will likely increase throughout 2023.
New Tech
The remainder of the year will also see an increased investment in technological advancements. Everything from virtual tours to online document signing is commonplace. However, technology may also help introduce more affordable housing to the market via 3D printing and modular homes.
While there are some promising signs for the current housing market, 2023 will likely be shaped by interest rates. If these rates start to drop, buyer interest might once again rise.
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5 Things New Homeowners Waste Money on
Becoming a homeowner is an exciting milestone, but it also comes with financial responsibilities. While it's natural to invest in your new space, it's important to spend wisely and avoid unnecessary expenses. Unfortunately, many new homeowners fall into common traps and end up wasting their hard-earned money on things that don't add much value or benefit to their new home. Here are a few common financial mistakes to avoid.
1. New Furniture and Decor
One of the biggest pitfalls for new homeowners is overspending on furniture and decor. Filling every room with brand-new pieces is tempting, but this can quickly drain your budget. Stay away from the furniture store in the weeks following your move. Instead, focus on the essentials and consider purchasing second-hand or refurbished items, which can save you a significant amount of money without compromising on quality. Additionally, compare prices at different stores before making any major purchases.
2. Lawn Services
New homeowners are often eager to get their yard and home exterior in perfect condition soon after closing. Lawn care services may even send offers in the weeks and months after you purchase your new home, but these services can be costly. You can do most of the things that lawn services advertise with some basic tools and some elbow grease. You can even consider hiring a neighborhood kid to help you! Either way, the cost will be far lower.
3. Extended Warranties
If you're buying a new appliance, there's a good chance that an employee will try to get you to purchase an extended warranty. While these warranties are useful on rare occasions, it's unlikely that a major appliance will malfunction during the warranty period, meaning you'll be spending money on something you'll never use.
4. Costly Additions
Making an expensive addition to your home right after you move in isn't recommended. While your backyard might be perfect for an outdoor kitchen, spending thousands of dollars on a second kitchen that you don't need is a quick way to waste a lot of money. Instead, prioritize improvements with a high return on investment, such as energy-efficient upgrades, or focus on smaller items that will improve the functionality and appearance of your home.
5. Impulsive DIY Projects
While do-it-yourself (DIY) projects can be a great way to save money, they can also lead to costly mistakes if not approached carefully. New homeowners often get carried away and tackle complex projects without the necessary skills or experience. This can result in expensive repairs or hiring professionals to fix the mistakes. Before embarking on a DIY project, thoroughly research and assess your abilities, and start with small, manageable tasks. For major renovations, it's often best to consult with experts to ensure the job is done properly.
As a new homeowner, it's crucial to spend your money wisely. A well-thought-out approach to homeownership will not only help you stay within your budget but also ensure that you maximize the value and enjoyment of your new home for years to come.
Mariusz „Mario” Misiewicz
HomeSmart Connect
cell: (773) 412-0517
e-mail: MisiewiczRealty@Gmail.com
on line: www.MisiewiczRealEstate.com