Last Updated on August 7, 2023 by Luke Feldbrugge
Welcome to the Housing Market Trends August 2023 report from Homes for Heroes! Whether you’re looking to buy a home, sell your current one, or refinance your mortgage, this report provides valuable insights from the experts to help you make informed decisions in today’s residential real estate market.
Overview of Housing Market Trends August 2023
The housing market is returning to a more normal state after two unprecedented years, often referred to as the “unicorn years.” Buyer demand has improved, and prices are rebounding, indicating a positive trend in price growth likely due to the peak selling season of summer. However, challenges remain, including limited housing supply and higher mortgage rates, and both continue to affect affordability for many potential buyers.
Key takeaways:
- Housing market returning to a more typical seasonal trend.
- Prices are rebounding, reflecting a healthier market, likely due to seasonality.
- Limited housing supply and higher mortgage rates continue to impact home buyer affordability.
Buyers and Sellers
Buyer demand is on the rise after a slowdown in 2022 caused by rising mortgage rates. Based on a survey conducted by Freddie Mac in May 2023, 18 percent of Americans are looking to buy a home within the next six months, indicating a strong desire for homeownership. And, on the other side, 16 percent of current American home owners are looking to sell their home in the next 6 months.
Market Supply of Homes for Sale (Inventory)
The housing market trend August 2023’s primary challenge is limited supply of homes for sale, providing fewer options for new home buyers or current homeowners looking to trade up or downsize. New listings have been declining due to homeowners’ uncertainty in the current market. That’s why the 16 percent of current home owners who want to sell in the 6 months is so promising for home buyers.
The higher mortgage rates of 6-7 percent over the past 10 months is starting to become the new “normal”. Although there is still some home buyer apprehension, there are fewer potential home buyers holding onto the hope of seeing the 3-4 percent mortgage rates again. Instead, the trend has been more home buyers moving forward with entering the market and not anticipating another large rate reduction as seen during the “unicorn years”.
The supply is improving, but housing market inventory growth remains slow.
Home Prices
Despite previous predictions of a major price decline, home prices are rebounding and showing stronger growth than expected. Listings prices have steadily increased over the past few months, and consumer expectations of price growth are aligning with typical seasonal changes. The return of seasonality suggests the market may be stabilizing.
New Construction
A silver lining in the market is the growth of new construction, providing more options for buyers and sellers. Builders have recognized the demand for more housing and have begun to increase production. Currently the southern region of the United States is leading in new construction due to population growth and affordability factors.
Summary of the Housing Market Trends August 2023
The housing market in August 2023 is showing positive signs of recovery and normalization after the challenges of the past few years. Buyer demand is rebounding, prices are on the rise, and new construction is offering more options for buyers and sellers. However, limited housing supply and affordability concerns continue to be significant challenges in the market.
If you’re considering buying or selling a home, it’s crucial to understand the current market trends and work with a trusted real estate agent and loan officer who can provide valuable insights and help you make confident decisions.
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