2023 Housing Predictions Revisited
You've seen my 2023 Huntsville, Alabama real estate predictions, now that we’re halfway through the year let's see how those predictions are faring.
1. Have Interest Rates Peaked?
I was really on the fence if interest rates had peaked and what interest rates might do in this market in 2023. I predicted that interest rates had peaked and that they would start to come down in 2023. I'm going to stick with that prediction.
Interest rates seem to have peaked in the low 7% range and they have come down slightly from that. With the Fed signaling that they may pause rates and a lot of fear and uncertainty being priced into the mortgage rates, it looks like that prediction could come true with interest rates staying flat and may even get down into the low 6% by the end of the year.
2. Fewer Home Sales
My second prediction was that we’d see fewer homes sold in 2023. We were predicting that there would be fewer homes sold here locally and nationally, with about 4 to 4.5 million homes sold nationally, which is down about 30% from that 6 million home level. I’m staying with that prediction here in Huntsville, we are definitely continuing to track that 20% to 30% decline in terms of the number of homes sold because there are just not enough homes available in the marketplace and not enough new construction out there to be able to satisfy the demand that we have in this local area.
3. Flight To Quality
The number three prediction was a bold prediction, predicting that a third of the real estate agents would exit the real estate market in 2023, and that has not come to fruition yet. Though in 2023, there has been a decline in terms of the number of real estate agents.
What happens with real estate agents is they actually pay their dues at the beginning of the year so a lot of them are paid up for the year. I think that prediction is going to come about, I just think it's going to take a little bit more time, probably a couple of years to see that prediction come about in our market.
4. New Construction
I predicted new construction would fall behind demographic and population growth here in Huntsville, and it has definitely not kept up. However, the builders have done an amazing job in shifting some of their product base to be able to get a more affordable product out into the marketplace and continue to relieve supply.
I thought a lot of these builders were going to go into hiding with higher interest rates and they simply haven't done that. Hats off to our builders for continuing to provide that supply for our marketplace. I'm adjusting that prediction as a lot of builders are really focusing on affordable housing.
5. Rents Begin To Fall
I predicted that rents would fall about 5%, maybe as much as 10%, with the potential overbuilding of all these apartment complexes in the Huntsville area. We simply haven't seen a huge decline, maybe a little bit of a decline or flat rates in terms of rent. My updated prediction is that we're going to stay flat for the year, maybe fall 5% depending on what happens the rest of the year, but I really think rents are going to stay flat throughout 2023.
6. Real Estate Values
Prediction number six was that Huntsville prices would stay flat throughout 2023 with some of the areas like California in the West declining and a lot of areas in the south, maybe slightly increasing or staying flat.
Actually, we had a 10.5% year-over-year increase in April so I’m updating that prediction to have a 5% price appreciation for the Huntsville area year over year in 2023.
7. Matt Curtis Real Estate is the #1 Real Estate Team in Alabama for the FOURTH Consecutive Year
All right. The one you've all been waiting for, the prediction that Matt Curtis Real Estate would win the #1 Real Estate Team in Alabama for the fourth straight year….
Matt’s Prediction for the Rest of 2023
After all of these predictions and everything I’m seeing out in the marketplace right now, I think it's going to be a hot selling season here this summer. Coming into the summer, we're at about 2.9 months' worth of supply, which is still a seller's market. I think that supply is actually going to decrease over the summer as there are just going to be a lot of buyers looking to buy prior to starting that new school year.
Look for the summer to be hot, especially anything south of $300,000 and right around that median sales price of $300,000 to $350,000. Expect to see multiple offers potentially going above list price this summer as we just have a hot area with income going up and a lot of people moving to the area. Also being ranked #2, really should be the #1 city in the US to live in, will have more people moving to the area.
Huntsville is going to have a very hot summer market. If you're looking to take advantage of this hot seller's market, shoot us an email at firstname.lastname@example.org or you can go on our website to request a home valuation or an instant cash offer today!Posted by Matt Curtis on