We are proud to present you with this synopsis of the national, regional, and localized trends that matter most to you, found here in our Richmond_2023 Annual Report.
Recapping the 2023 real estate market is anything but straightforward. It was a year of conflict in the real estate world. Five years of unparalleled buyer demand led to the smallest inventory of homes, not just here in Richmond, but in virtually every market in the U.S. Prices escalated while interest rates rose at the fastest pace the U.S. market has ever experienced, as evident in historically low affordability rates. And while early in 2023 the inflation looked staggering, it levelved near where the Fed was targeting. And contrary to every prediction, unemployment remained consistently low.
So where did the year end? Many indicators such as prices (especially when looked at as a monthly expense as part of a mortgage) show that home costs are too high for many borrowers. But the reality is that while many would-be buyers have been priced out, because of the small inventory, there are still enough buyers to absorb all the new homes on the market. And the interest rates aren’t just stopping buyers from buying, they are stopping sellers from considering a move. 82% of homeowners have a mortgage rate below 5% while mortgage rates bounce between 7 and 8%. And yet, Zillow found in an ongoing survey that the current percentage of home owners who wish to sell their home within the next three years is the highest they have ever seen.
So what’s to come? While there is no obvious path the housing market is likely to take, there are signs that it won’t balance for quite a while. Richmond remains a desirable community, with unemployment levels significantly below the nation. Couple that with a small inventory of resale homes likely to hit the market, and our area seems destined for continued price stability.
–For more information, visit us at NestRealty.com.