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6 Housing market predictions for 2023 in Memphis

Selling your Memphis Tennessee home is never a simple process. But it can be especially difficult if you have to sell your Memphis house fast. In this article, we will take a look at some predictions for 2023 for six experts in the market to allow you to get a fast sale:

The Federal Reserve and mortgage rates

The Fed raised its key short-term interest rate, a smaller hike than its previous four, as inflation showed signs of easing. This indicates that the economy would be grappling with slower growth, higher unemployment and higher inflation in 2023. This typically leads to lower long-term interest rates, including mortgage rates – Mike Fratantoni, chief economist for the Mortgage Bankers Association.

Innovations in mortgage finance

Innovation will accelerate with lenders, startups, advocates, researchers, and policymakers actively pushing the envelope around what’s possible in mortgage finance. The creation of new programs around alternatives in credit scoring, artificial intelligence, climate adaptation, manufactured housing. Also, there will be an increased use of adjustable-rate mortgages, which made up 12% of total applications in November, up from 3.3% in November 2021. – Janneke Ratcliffe, vice president of the Housing Finance Policy Center at the Urban Institute.

No ‘foreclosure tsunami

Homeowners have very high levels of tappable home equity today, providing a cushion to withstand potential price declines, but also preventing housing distress from turning into a foreclosure. We can expect the number of foreclosures to drift higher as the labor market slows and house prices fall from their peak, the result will likely be more of a foreclosure trickle – Odeta Kushi, deputy chief economist for First American Financial Corp.

Housing inventory will remain low

The chronic lack of listing inventory has been the key driver of price gains during the pandemic-era housing boom, and it will be the key underpinning of prices during 2023. There will be 4.3 million home sales in 2023, which is fewer home sales than in any year since 2011 and a decrease of 16% year over year. –  Jonathan Miller, who prepares the monthly Douglas Elliman Real Estate report for New York City.

Declining home prices

The median U.S. home-sale price will drop by roughly 4% in 2023. Homes will be much less affordable in 2023 than they were before the pandemic homebuying boom. Taking next year’s projected prices and mortgage rates into account, the typical homebuyer’s monthly payment will be about 63% higher in 2023 than it was in 2019. Prices are expected to fall most in pandemic migration hotspots like Austin, Texas, Boise, Idaho, and Phoenix- Taylor Marr, deputy chief economist for Redfin.

New home construction outlook

The NAHB/Wells Fargo HMI, has declined for 11 straight months, signaling an ongoing contraction for home building in 2023. Multifamily construction volume will fall back in 2023. There are nearly 930,000 apartments under construction, the highest total since January 1974, this means a rising unemployment rate, increased apartment supply, rising vacancy rates and slowing rent growth will slow multifamily construction next year – Robert Dietz, chief economist for the National Association of Home Builders.

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