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A Perspective on Real Estate Market in 2023: Separating Fact from Fiction
Dated: September 5 2023
Towards the end of last year, you might have seen alarming headlines predicting substantial falls in home prices this year. Understandably, this might have raised concerns and questions about the possibility of a housing crash akin to the one we witnessed back in 2008. However, it's crucial to set the record straight and provide some context.
The Experts Got It Wrong:
While there was indeed a slight correction in home prices after the soaring appreciation during the 'unicorn' years, nationally, home prices didn't come crashing down as some had predicted. If anything, they have proven to be more resilient than many expected.
Let's look at some of the expert forecasts from late last year and compare them to their most recent predictions. This will demonstrate that even the experts themselves have recognized their initial pessimism.
Expert Home Price Forecasts: Then and Now
The chart below showcases 2023 home price forecasts from seven reputable organizations. It illustrates their original forecasts for the end of this year (released in late 2022) and their most recent revised predictions. Initially, all experts foresaw home prices falling. However, their updated projections now indicate that they expect prices to either remain steady or experience positive growth. This is a significant departure from their initial negative outlook.
Why Are Home Prices So Resilient?
You might be wondering why home prices have remained strong even in the face of predictions to the contrary. As Odeta Kushi, Deputy Chief Economist at First American, points out:
"One thing is for sure, having long-term, fixed-rate debt in the U.S. protects homeowners from payment shock, acts as an inflation hedge - your primary household expense doesn't change when inflation rises - and is a reason why home prices in the U.S. are downside sticky."
What to Expect Moving Forward:
As we move forward in the year, you can anticipate more media coverage related to home prices. It's essential to understand that there's seasonality to home price appreciation, and the media might misinterpret this. Here's what you need to know to stay ahead of the next round of negative headlines.
Towards the end of this year, as activity in the housing market naturally slows down (as it typically does), home price growth will also decelerate. This doesn't mean prices are falling; it simply means they're not increasing at the rapid pace we witnessed during the peak homebuying season.
In simple terms, slower appreciation isn't the same as home prices depreciating.
The impact of headlines is undeniable, even when they don't necessarily reflect reality. While the media predicted significant home price drops at the end of last year, the actual outcome has been different. As you navigate the Maine real estate market, it's crucial to have a trusted resource who can help you decipher fact from fiction using reliable data.
I'm here for you as that resource. If you're considering selling your home or have any questions about the market, please don't hesitate to connect with me. Let's work together to ensure you make informed decisions based on the true state of Maine's real estate market.
- Rob Edgerley, Southern Maine Real Estate Agent [firstname.lastname@example.org, 207-332-2476]
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- Thinking of making your move in your career this year? Watch our youtube video series Facts from the 4 Runner or watch this:
- Did you miss our Report in Maine Life Real Estate? Check out Maine's Hottest Towns Report and find out the Top 10 Towns in Maine with the most booming housing Market.
- Are You Thinking About Buying a Home? The process of buying a home can be overwhelming at times, but you don't need to go through it alone. You may be wondering if now is a good time to buy a home…or if interest rates are projected to rise or fall, this free eGuide below will answer many of your questions.
- Are you planning to sell your house this 2023? It's difficult to know when is the best time to sell, or how to get the most money for your house, but you don't need to go through the process alone. Download this Free Seller Eguide to answer all your questions.
Check out my Youtube Channel, learn more about Maine Life Real Estate and be updates about new listings tours in this channel:
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Rob has built an organization dedicated to assisting his clients during every aspect of the transaction. He leads his company with the highest level of integrity and hard work. You will have a team of....
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