Is 2023 a Good Time to Invest in Real Estate?
Real estate investment is a good business idea with low capital but high reward. The housing market’s biggest challenge has been a lack of supply in the face of heavy demand. Inventory has fallen to record lows, meaning there aren’t enough homes on the market to keep pace with the number of buyers house hunting. But things could be different in 2023. If you’re interested in buying or selling property, here are a few things to look for in 2023.
Fewer All-cash Sales
The number of all-cash sales in the United States has decreased by 3 percent since 2012, according to RealtyTrac.
This is a significant change when you consider that all-cash sales accounted for 46 percent of all transactions in 2012.
In some areas of the country, like California and Colorado, there has been an even bigger drop in the number of all-cash sales. The San Francisco Bay Area saw a 16 percent decrease in all-cash sales over this period, while Denver experienced a 19 percent decrease.
The reasons for this shift are unclear, but one hypothesis is that people are getting more comfortable with using alternative financing options like home equity loans and lines of credit. Another theory suggests that there is less demand for luxury properties because of rising interest rates on mortgages.
More Resales from People Currently Underwater on their Mortgages
If you’re underwater on your mortgage, it’s probably time to think about selling.
Here are some things to consider:
If you are looking to sell, consider a quick sale. Many people are looking for ways to move quickly and get out of their homes, so they can buy another one or even rent out the old one. If it’s the right time for you, there are many opportunities in this market.
You can also consider managing your home yourself. This is an easy way to make extra cash, especially if you have the skills and experience necessary to do it well. It can also be a great way of making sure your home stays in good shape while you’re away at work or school.
Finally, if all else fails and you still want to keep living in your house but can’t afford the mortgage payments anymore, there’s always a possibility that someone will want to buy it from you in 2023!
Older Homeowners Staying Put
As more and more older homeowners choose to stay in their homes, the real estate industry is adjusting to meet their needs.
Real estate agents are now focusing on property management because they know that homeowners want to stay in their homes as long as possible.
This has led to a boom in the industry as companies offer new services that help people maintain and improve their homes.
For example, we have seen an increase in companies that provide lawn care for seniors. These are typically part-time employees who come over once a week to mow the lawn or trim branches from trees on the property.
Higher Mortgage Interest Rates
Mortgage interest rates are expected to increase from the current 3% – 3.5% range, back toward their historical average of 5%. If rates do rise significantly, we could see fewer buyers at the low end of the housing market and fewer first-time homebuyers.
Baby boomers still have a lot of equity and buying power, so if they decide to sell their houses and leave the suburbs or rural areas in favor of cities, they will probably have no problem getting the full asking price – if not more.
In 2023 real estate investment could look different than it has the last few years.
Investment and expansion into property management.
Getting a head start on amortization.
Enhance the standard operating procedure and run it for two years.
Getting the most out of property taxes.
Invest in your team training and growth.
Real estate investment will be a complicated but huge market in 2023.