Revisions in 2023 Expert Home Price Predictions Signal Resilience in the Housing Market

Lisa Mailhot  |  September 5, 2023

Buyers

Revisions in 2023 Expert Home Price Predictions Signal Resilience in the Housing Market

 

Towards the conclusion of the previous year, numerous reports circulated, predicting a substantial decline in home prices for 2023. These forecasts ignited widespread concern and raised questions about the possibility of a housing market crash akin to the 2008 recession. However, it turns out that these headlines missed the mark.

Despite a slight correction in home prices following the meteoric rise during the 'unicorn' years, the national housing market did not experience a catastrophic collapse. In fact, home prices exhibited far more resilience than initially anticipated.

Let's delve into some expert predictions made late last year and compare them to their most recent projections, revealing that even the experts acknowledge their earlier pessimism.

Expert Forecasts for Home Prices: Then vs. Now

This visual representation showcases the 2023 home price forecasts from seven reputable organizations. It presents their original 2023 predictions, released in late 2022, regarding the expected direction of home prices by the end of the current year, along with their most recent revised forecasts (as depicted in the chart below):

As indicated by the red bars in the middle column, all initial forecasts foresaw a decline in home prices. However, a glance at the right column reveals that these experts have since adjusted their year-end projections to indicate either stable prices or positive growth. This marks a significant departure from their initial pessimistic outlook.

Several factors contribute to the resilience of home prices against a downturn. As articulated by Odeta Kushi, Deputy Chief Economist at First American:

“One thing is for sure, having long-term, fixed-rate debt in the U.S. protects homeowners from payment shock, acts as an inflation hedge - your primary household expense doesn't change when inflation rises - and is a reason why home prices in the U.S. are downside sticky.”

Anticipating Future Developments to Stay Informed

Expect misleading media coverage regarding home prices in the months ahead, primarily due to the seasonality of home price appreciation. The media is likely to misinterpret this pattern. Here's what you should be aware of to stay ahead of the next wave of negative headlines.

As the activity in the housing market naturally slows towards the end of the year (as is customary), home price growth will also decelerate. However, this should not be confused with a decline in prices; rather, it indicates that prices are not rising as swiftly as during the peak homebuying season.

In essence, a reduction in the rate of price appreciation should not be equated with a drop in home prices.

Bottom Line

Headlines can wield influence, even when they do not align with reality. Despite media claims that home prices would significantly decline at the close of the previous year, such an outcome did not materialize. Let's connect, so you can rely on a trustworthy resource to help you distinguish facts from fiction through dependable data.


RECENT BLOG POSTS

Discovering the Spookiest Haunted “House” on Water: The William A. Irvin Ship

Dive into the eerie world of Duluth’s William A. Irvin ship, known as one of the world’s scariest haunted “houses.” This historic vessel transforms into a haunted att… Read more

Solar Panels or Moss? How Aerial Errors Lead to Policy Drops

Discover how homeowners can protect their policies as insurance companies increasingly rely on aerial technology. Learn why your solar panels might be mistaken for roo… Read more

Orange County’s Housing Crisis and Economic Divide: A Tale of Two Economies

Discover the latest on Orange County’s housing challenges and wealth divide. Rising housing costs and economic bifurcation reveal a complex future for Southern Califor… Read more

Mortgage Rates Rise as Homebuyers Weigh Their Move Before Winter Hits

Mortgage rates climb to 6.54%, challenging homebuyers and sellers to navigate the real estate market this season. Discover current housing trends, inventory levels, an… Read more

Mastering the Art of Defusing Explosive Real Estate Situations

Real estate agents constantly face high-pressure situations that trigger the fight, flight, or freeze response. Learn practical strategies to defuse tense scenarios an… Read more

How Special Locks Can Keep Kids with Autism Safe?

Discover how affordable key-coded locks are helping parents of children with autism, offering security and peace of mind. Learn how this simple solution can safeguard … Read more

Don't Let Hidden Debts Derail Your Home Sale

Learn how to uncover property liens before they jeopardize your home sale. Liens can emerge unexpectedly, but with a few simple steps, you can stay ahead and protect y… Read more

Experience the Magic with A Taylor Swift-Inspired Airbnb in New Jersey

Discover the ultimate Taylor Swift-inspired Airbnb in South Jersey, offering fans a dream escape with themed rooms, Swiftie decor, and unforgettable experiences. Perfe… Read more

Real Estate Deals and Promotions: The Ethical Dilemma of a Secret Service Agent’s Side Hustle

Did a Secret Service agent cross ethical lines by representing his subordinates in real estate transactions? Explore the case of Alfonso Dyson, promotions, and potenti… Read more

We are excited to assist you in finding your perfect home

Let's find a time that suits you best to chat about your goals, show you how we work, and figure out how we can help you the most