How to Decide Whether to Buy a Home Now or Wait a Bit Longer
2023 could be the perfect year to purchase your dream house — or not — depending on your situation, your needs, and what you’re looking for in your next home.
In fact, so far in 2023, the markets in some areas have shifted remarkably, and:
- Those shifts may continue, as many experts have predicted ongoing volatility, inflation, and/or economic downturn this year.
- Some home buyers may find the market shifts to be game-changing, giving them good reasons to either stay on the house hunt or sideline themselves for now.
To help you figure out where you stand and what’s next for you as a homebuyer, here’s what’s crucial to consider. Carefully weighing out these factors can help you make a more prudent decision about when to buy a house and if now’s really the right time.
Homebuying in 2023: What to Expect & 3 Factors to Consider
Before you start looking at listings or even visiting houses on the market, take some time to carefully think about the following aspects of buying a house, how they could be different in 2023, and whether those differences work for or against you as a homebuyer:
1. Stagnant or rising mortgage rates
While mortgage rates dropped over the last months of 2022, according to Freddie Mac, those rates were falling from all-time high of just over 7%. Since then, they’ve steadied around 6% to 6.5%, with many analysts and real estate experts expecting these mortgage rates to hold fairly steady, if rise some, as we get deeper into 2023.
For homebuyers, especially those with shaky credit, that means that borrowing could be more expensive this year. Consequently, if you are serious about buying a house this year, you’ll want to keep a close eye on your credit score and do what you can to boost your credit score as much as possible.
2. Low inventory
Another marked change in the 2023 housing market could arise with stagnating or even dwindling inventory. Specifically, with this year’s fluctuations in interest rates — and with several homeowners locked into lower interest rates on their mortgages — many who were tossing around the idea of selling their house could opt out, choosing to wait for more favorable market conditions for sellers.
While that could result in fewer listings and lower inventories as we get deeper into 2023, it may also mean that buyers shouldn’t expect a deal on home prices any time soon. In fact, some areas could see home prices climb this year, experts warn.
3. Falling competition among younger or first-time homebuyers
Those in the market for starter homes, as well as homebuyers with not-so-great credit, are expected to feel the most backlash from the 2023 housing market shifts. That’s because this group tends include the most interest-rate-sensitive buyers — and they tend to be in the market for houses that are on the lower end of the pricing scale.
With interest rates and housing prices having the potential to climb this year, first-time buyers and, in particular, Millennial homebuyers, are expected to face more challenges buying homes this year.
That’s why many analysts say these homebuyers may pause their house shopping, waiting for more favorable market conditions to return.
Buy a House in 2023? 5 Questions to Ask
Knowing how the housing market could shift in 2023 is helpful, but it may not be enough to help you answer the question of whether or not you should buy a house this year.
To help you do that, here are a handful of questions to ask yourself and answer truthfully:
- What type of down payment can you afford?
- What is your credit score now? Could you do anything to significantly improve your credit score over the next 3 to 6 months?
- Where do you want to buy a house?
- What’s your target price range?
- What are your must-haves in the house you buy?
Ready to Buy a Home in Texas? Get Help & Get CASH BACK at Closing
Whenever you’re ready to buy a home in Houston, Dallas, Austin, San Antonio, or anywhere in Texas, the support of a pro can be priceless, especially when it comes to streamlining the closing process.
To get experienced help buying a house and to get cash back at closing, work with the 5-star Realtors® at New Home Gurus. We can guide you through the process, helping you with offers, negotiations, and closing. Plus, we’ll split our commission with you after the sale closes!
Home buyers who work with New Home Gurus can get back an average of $4,500 to $12,000 at closing.
How Much Cash Can You Get After Closing?
Call (281) 668-8124 or Contact Us to Find Out Now
We are standing by, ready to answer your questions and explain the details of our commission-sharing program.