Happy New Year! As we enter 2023, I think it’s important to continue our focus on perspective when it comes to the current climate of our economy, specifically the real estate market.
Trends over Decades
The image below shows the median price of homes in the United States going back to 1960. Over five decades and eight recessions since, home prices have only gone up.
Post 2008 - The Worst Recession since 1929
If we take a look at the time following the great recession of 2008, even though it was the worst recession since the Great Depression of 1929, home prices not only recovered but continued growing. Think about this- Through multiple recessions, the oil patch crisis, the dot com recession, the Great Recession, all of them, home prices only go up over time.
What does the future hold?
As we head into 2023, my theme is this: Betting on housing is a loser’s game. Stop wondering what will happen in the next six months and look at this market as the opportunity that it is. For the first time in many years potential homebuyers can now bargain for their purchase. And yes, some hyper-localized markets still are too hot and remain a sellers’ market, while others are softer and pose options for buyers. But make no mistake about it, this market is on the verge of recovery.
What does this mean for you?
The MBA forecasts a soft 1st quarter but expects home values to rise in the second half of 2023 and even more in 2024 and 2025.
So be advised…. this may be the one and only window for the next few years to get into a buyer’s market. And remember, as the Federal Reserve data shows, home prices only go up and always recover from recessions no matter how mild or severe. Long term homeowners should view this market as a unique buying opportunity. If you’re a buyer right now, this may be the chance you’ve been waiting for.