Most housing analysts expected 2023 to be a rough year for the U.S. housing market. In fact, among the 29 major housing forecast models, 24 forecasted a national home price decline for 2023.
But, so far, that hasn’t proven to be true.
Through the first few months of 2023, the U.S. housing market continues to show signs of stabilization. Existing and new home sales have inched up a bit this year, and homebuilder confidence has improved. Firms like Zillow, CoreLogic, and Black Knight have all reported positive month-over-month home price increases this Spring.
What’s going on? For starters, a lack of homes for sale, coupled with the market entering its busier Spring period, has, at least for now, pushed the national housing market back into equilibrium.
Don’t misread the above statement and think that the housing market is normal just yet. Some housing markets are booming right now, while others, like San Jose, are still passing through a home price correction. Even within a particular market, it can vary considerably.
According to Zillow, among the 1,563 California ZIP codes tracked, 6.7% saw home price increases between December 2022 and March 2023. The other 93.3% of California ZIP codes saw a home price decrease, if only slightly.
CoreLogic, a real estate research firm, expects U.S. home prices to rise 3% between January 2023 to January 2024. If CoreLogic is correct, then U.S. home prices would end 2023 back at price levels achieved at the height of the boom in June.
It is good to remember that the appreciation in California home values during the past 2 years was about 15%, so these slight declines should not deter buyers from jumping into the real estate market.
If you are looking for a private real estate loan, and can’t qualify for a conventional loan, look no further than Sun Pacific Mortgage. We have been lending to California real estate investors for over 35 years. Give us a call at 707-523-2099 or find us at www.sunpacmortgage.com.
