Home Sales Head South
Sales of existing homes fell 2.4% in March as more buyers wait for lower mortgage rates.
This was after home sales increased in February 2023, which was the first increase in a year. Sales fell in the West, Midwest and Southern regions, but were unchanged in the Northeast.
Home resales, which account for a big chunk of U.S. housing sales, tumbled 22.0% on a year-on-year basis in March. The Federal Reserve's rate hiking campaign to curb inflation has resulted in residential purchases contracting for seven straight quarters.
However, builder optimism is growing as single-family homebuilding increased for a second straight month in March. Permits for future construction also surged last month.1
Real Estate Experts share 2023 Predictions
While none of these brokers and agency owners own a crystal ball, here is what some are expecting later this year.
A balanced market will return. As rates rise, sellers determined to make a move will need to remember that buyers are getting some leverage. Although some would-be sellers may decide to hang on to their low rate mortgages, others will offer concessions.
Inventory will increase. Even though today's inventory is "all over the place", it's predicted to improve when mortgage rates stabilize. New home construction is picking up, with many builders offering buy-downs and other concessions to increase affordability.
A sense of normalcy will return...eventually. More first-time buyers will be welcomed with their FHA loans, as sellers are no longer calling all of the shots. Buyers who have felt priced out of the market will revisit the market later this year, and they'll probably be choosier than before.
Rates will continue to increase, driving prices down. Agents and brokers alike are predicting that interest rates will continue slow growth, fueled by additional Federal Reserve rate hikes. However, they're quick to point out that this may drive home prices down.2
How Drones Add Buzz to Your Listings
Almost any listing will benefit from professional drone photography – both stills and video – even if it isn't The Biltmore Estate or Graceland. Here's why:
Prospective buyers will see that they're not just buying a home, they're buying a neighborhood experience. If your listing is near a park, playground or walking/biking trail, a drone can help you give them the big picture.
Nearby retail centers can be brought into view. If your listing is near a popular shopping center or upmarket grocery, this could add to your listing's salability.
Getting a bird's eye view of a home's best features, right down to the new roof and other features that are out of view, gives buyers a more impressive picture of what they'll get.3
Three Agents That Proved Older is Better
Love your job too much to consider retiring? These three agents felt the same way.
George W. Johnson's Ballard, Washington office features the slogan "Serving the Seattle area with quality and excellence since 1936." It also features a 1947 photo for a home listed at $6,000. Johnson helped form Seattle's first MLS, and worked six days a week until just after his 98th birthday. Now his son keeps his service legacy alive.4
Ebby Halliday made a career switch from selling hats to real estate in 1945, when a developer challenged her to sell 52 homes he'd built in Dallas, Texas. She sold them all and proceeded to found Ebby Halliday Realtors, the 10th largest independent real estate firm in the nation. Halliday continued to drive herself to work at the age of 98.
5
Stewart Wade rises at 5:30 or 6:00 most mornings, takes a swim in the Pacific, and then heads to his Waimanalo, Hawaii office by 8:00 a.m. Did we mention he was doing this at the age of 99? Stewart made the switch from pharmacist to real estate agent in the 1960s and never looked back. "I made more money in my 80s than I ever did in the rest of my life," he says. "I was very healthy and very vigorous."6
FHFA Announces New Price Adjustments Sources: 1finance.yahoo.com,
2finance.yahoo.com,
3aerialnorthwest.com,
4gwjrealty.com,
5dallasisd.org,
6businessinsider.com,
7fhfa.gov
Beginning in May 2023, clients buying with a conforming loan may be faced with a cheaper or more expensive loan, depending on their FICO score.
This is because Loan Level Price Adjustments, aka LLPAs, have been changed to give buyers with lower credit scores a break. LLPAs are based on a loan's credit score, LTV, type of occupancy, and the borrower's Debt to Income ratio.
The former penalty for borrowers with credit scores under 680 has been reduced, although low scores still contribute to higher costs. However, borrowers with higher scores will be paying more than they did before these changes, which has caused some unhappiness.
Other price adjustments will be introduced in May. Buyers who opt for an FHA, VA or other non-conforming loan won't be affected.
Contact me for more information about these LLPA changes.7
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