Common Homebuyer Misconceptions in 2023
Homeownership remains a top priority for Americans, but many are uninformed about the real estate market and have misconceptions that could hinder their chances of successfully buying a home. Don't miss out on your chance to buy a home in the Huntsville, AL area in 2023, and make sure you are informed about the real estate market.
Pent Up Homebuyer Demand
According to a NerdWallet survey, 83% of Americans say buying a home is a top priority for them. That's showcased in the survey results that found 28 million Americans plan to buy a home in 2023. The reason that the stat jumps off the page is that in an average year, 6 million homes are sold across the US. If 28 million buyers across the US plan to buy a home but only 6 million homes are typically sold in a given year, that is a big disconnect. In fact, many believe that this is going to be a below-average year with only about 4 million homes sold.
Since only about 1 in 7 actual buyers that plan to buy a home will likely buy a home in 2023, this shows that there's a lot of pent-up demand out there. As interest rates start to drop, there are a lot of buyers sitting on the sidelines that would like to enter this real estate market.
Homebuyers Misinformed On Average Home Price
Another stat that jumped out to me in this NerdWallet study is that the average budget for these 28 million Americans planning to buy a home in 2023 is only $269,200. Home values have not been that low on average since 2013.
On average, our median sales price nationally is actually up to $388,100. Affordability is a big crisis in our country right now which is likely going to continue to push down the homeownership rates in the US.
Homebuyers Expect A Real Estate Crash
NerdWallet found that two-thirds of Americans that were surveyed expect a real estate crash in 2023. The reason that this stat jumps out is that this is not 2008, and that's not what the experts are predicting.
The National Association of Realtors (NAR) is predicting that the average sales price at the end of 2023 will be $385,800, which is relatively flat. The real estate company, Redfin, is predicting a 4% drop. What that likely means is in states like California and cities like Seattle, they’ll probably experience a 10% drop. However, as you get into the south that's going to likely be a relatively flat market in those areas including the Huntsville, AL housing market.
The other thing about having a real estate crash is you got to have a supply and demand imbalance. The fact is, supply is in balance with the demand right now. We're actually in a slight seller's market, with less than four months' worth of supply. Demand has decreased by about 30%, however, supply has decreased in relation to that at 27% as well.
Mortgage Rates Are NOT Unprecedented
The survey found that 61% of Americans surveyed say mortgage rates currently are unprecedented. At the time of this article, the average 30-year rate was 6.15%. Over the last 50 years, the actual average interest rate in this country has been 7.75%. Pre-2008, it was very normal to have interest rates in that 6% to 7% range, which is what we've been saying for the last 6 to 12 months.
70% of Americans who planned on buying a home in 2022 were unfortunately unsuccessful. Don't be one of the millions of Americans that are unsuccessful in buying a home in 2023, send us an email at firstname.lastname@example.org or contact us here and we'll make sure you achieve your real estate goals in 2023!Posted by Matt Curtis on