{"id":35182,"date":"2023-04-03T05:20:41","date_gmt":"2023-04-03T12:20:41","guid":{"rendered":"https:\/\/www.homelight.com\/blog\/?p=35182"},"modified":"2026-04-13T07:07:55","modified_gmt":"2026-04-13T14:07:55","slug":"buyer-silver-linings-for-home-buyers-in-2023","status":"publish","type":"post","link":"https:\/\/www.homelight.com\/blog\/buyer-silver-linings-for-home-buyers-in-2023\/","title":{"rendered":"5 Silver Linings for Home Buyers in 2023"},"content":{"rendered":"

If you\u2019re thinking about buying a home right now, you\u2019re probably eyeing housing market headlines with caution. Everything from stubborn inflation and increasing mortgage rates to potential home price declines could cause potential buyers to rethink a new home investment. But there are also reasons for home buyers to be optimistic.<\/p>\n

Some experts believe many concerns about the housing market are overblown, and they see opportunities for home buyers to cash in on buyer-friendly patterns that are surfacing on the horizon. In this article, we talk to top real estate agents and housing market experts, dig into the details of the housing market, and unearth the silver linings that could emerge for home buyers in 2023.<\/p>\n\n\n\n\n\n

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Step one: Connect With a Proven Top Agent<\/h3>\n

Tell us a little bit about your plans (where you’re looking to buy and when you want to make a purchase) and we’ll connect you with top-rated buyer’s agents in your selected market. We analyze over 27 million transactions and thousands of reviews to determine which agent is best for you based on your needs.<\/p>\n \n

\n Get Started<\/a>\n <\/div>\n <\/div>\n<\/div>\n\n\n
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Why the market may be tilting toward buyers in 2023<\/h2>\n

Everything from negative headlines about the housing market to worries about high mortgage rates, inflation concerns<\/a>, and more are causing potential home buyers to question whether they should purchase a home in 2023. However, despite many negative feelings about the housing market, experts say there are bright spots for home buyers to consider in 2023:<\/p>\n

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1. Competition has fallen from highs<\/h3>\n

Home sales were on a tear throughout the pandemic, hitting the highest levels since 2006<\/a>. During the second quarter of 2022, 80%, of U.S.<\/a> metro areas saw double-digit home price increases. However, they\u2019ve marched downward in recent months, striking the lowest point<\/a> in more than a decade in January. That could present an opening for home buyers who were outbid in the previous housing cycle.<\/p>\n

\u201c[Buyers] have the ability to ask for some concessions, ask for repairs, home warranties \u2013 things of that nature,\u201d says Oriana Shea<\/a>, a top-selling Long Beach real estate agent who has more than 25 years of experience in the industry. \u201cA year and a half ago, it was unheard of. You had to be competitive, and a lot of their negotiating power was taken away. So, I think we’ve entered a more normalized environment for buyers and sellers.\u201d<\/p>\n

HomeLight\u2019s Top Agent Insights for New Year 2023<\/a> report echoes the idea that the housing market is shifting to favor more buyers. According to the study, more than a third (34%) of agents predicted a buyer\u2019s market in 2023, while only 12% expected a seller\u2019s market in their area. That\u2019s a significant swing, considering earlier HomeLight studies<\/a> throughout the previous two years consistently saw 90% of agents describe their area as a seller\u2019s market.<\/p>\n

As buyers gain power in 2023, they could see more room to negotiate better deals, and they might have a chance to participate in a housing market<\/a> that shut them out in the past.<\/p>\n

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2. Prices are inching lower<\/h3>\n

As high mortgage rates tamp down housing demand, prices are peeling back in some areas of the country. According to the S&P Dow Jones Indices<\/a>, home prices in all 20 of the major cities that the group tracks fell in December. Those price declines are especially sharp in the West and Southwest. That same report found these cities experiences the biggest monthly price drops in December:<\/p>\n\n\n\n\n\n\n\n\n
City<\/td>\nMonthly price decline Nov.-Dec. (2022)<\/td>\n<\/tr>\n
Portland<\/td>\n-1.9%<\/td>\n<\/tr>\n
Phoenix<\/td>\n-1.9%<\/td>\n<\/tr>\n
Las Vegas<\/td>\n-1.8%<\/td>\n<\/tr>\n
Seattle<\/td>\n-1.8%<\/td>\n<\/tr>\n
San Francisco<\/td>\n-1.8%<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Source: S&P Dow Jones Indices and CoreLogic Data, 2022\u00a0<\/i><\/p>\n

Nadia Evangelou<\/a>, the National Association of Realtors’ (NAR\u2019s) Senior Economist & Director of Real Estate Research, says price declines are opening up housing options to buyers who may have been unable to afford purchases in the past.<\/p>\n

\u201cMore people are coming back to the market because they can afford to buy a home,\u201d she says.<\/p>\n

In 2023, lower demand could help deflate home prices and give home buyers a chance to purchase property at a price point they can afford.<\/p>\n

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3. Mortgage rates remain below the historic average<\/h3>\n

Mortgage rates have jumped quickly in recent months. According to Trading Economics<\/a>, the average rate of a 30-year fixed mortgage climbed from the record low of 2.65% in January 2021, to recent highs near 7% in 2022. Since then, the average for these rates has settled at around 6.42% as of March 2023.<\/p>\n

However, what home buyers don\u2019t always realize is that even at recent highs, rates for a 30-year fixed mortgage still sit below the historic average. According to the same Trading Economics Data, the average rate for a 30-year fixed mortgage from the 1970s through 2023 is 7.75%. The historic high from that period came in October of 1981 and was 18.63%.<\/p>\n

Evangelou reiterates that, even though mortgage rates may be high for individuals who have been shopping for homes in recent years, they may not be as scary as many assume.<\/p>\n

\u201c3% rates are not the benchmark,\u201d she explains. \u201c3% was a historic low. 6% is still a good [rate] percent compared to the historical average.\u201d<\/p>\n

Mortgage rate trends (annual averages) 1974-2021<\/h4>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
Year<\/b><\/td>\nAverage 30-year rate<\/b><\/td>\nYear<\/b><\/td>\nAverage 30-year rate<\/b><\/td>\nYear<\/b><\/td>\nAverage 30-year rate<\/b><\/td>\nYear<\/b><\/td>\nAverage 30-year rate<\/b><\/td>\n<\/tr>\n
1974<\/b><\/td>\n9.19%<\/td>\n1986<\/b><\/td>\n10.19%<\/td>\n1998<\/b><\/td>\n6.94%<\/td>\n2010<\/b><\/td>\n4.69%<\/td>\n<\/tr>\n
1975<\/b><\/td>\n9.05%<\/td>\n1987<\/b><\/td>\n10.21%<\/td>\n1999<\/b><\/td>\n7.44%<\/td>\n2011<\/b><\/td>\n4.45%<\/td>\n<\/tr>\n
1976<\/b><\/td>\n8.87%<\/td>\n1988<\/b><\/td>\n10.34%<\/td>\n2000<\/b><\/td>\n8.05%<\/td>\n2012<\/b><\/td>\n3.66%<\/td>\n<\/tr>\n
1977<\/b><\/td>\n8.85%<\/td>\n1989<\/b><\/td>\n10.32%<\/td>\n2001<\/b><\/td>\n6.97%<\/td>\n2013<\/b><\/td>\n3.98%<\/td>\n<\/tr>\n
1978<\/b><\/td>\n9.64%<\/td>\n1990<\/b><\/td>\n10.13%<\/td>\n2002<\/b><\/td>\n6.54%<\/td>\n2014<\/b><\/td>\n4.17%<\/td>\n<\/tr>\n
1979<\/b><\/td>\n11.20%<\/td>\n1991<\/b><\/td>\n9.25%<\/td>\n2003<\/b><\/td>\n5.83%<\/td>\n2015<\/b><\/td>\n3.85%<\/td>\n<\/tr>\n
1980<\/b><\/td>\n13.74%<\/td>\n1992<\/b><\/td>\n8.39%<\/td>\n2004<\/b><\/td>\n5.84%<\/td>\n2016<\/b><\/td>\n3.65%<\/td>\n<\/tr>\n
1981<\/b><\/td>\n16.63%<\/td>\n1993<\/b><\/td>\n7.31%<\/td>\n2005<\/b><\/td>\n5.87%<\/td>\n2017<\/b><\/td>\n3.99%<\/td>\n<\/tr>\n
1982<\/b><\/td>\n16.04%<\/td>\n1994<\/b><\/td>\n8.38%<\/td>\n2006<\/b><\/td>\n6.41%<\/td>\n2018<\/b><\/td>\n4.54%<\/td>\n<\/tr>\n
1983<\/b><\/td>\n13.24%<\/td>\n1995<\/b><\/td>\n7.93%<\/td>\n2007<\/b><\/td>\n6.34%<\/td>\n2019<\/b><\/td>\n3.94%<\/td>\n<\/tr>\n
1984<\/b><\/td>\n13.88%<\/td>\n1996<\/b><\/td>\n7.81%<\/td>\n2008<\/b><\/td>\n6.03%<\/td>\n2020<\/b><\/td>\n3.10%<\/td>\n<\/tr>\n
1985<\/b><\/td>\n12.43%<\/td>\n1997<\/b><\/td>\n7.60%<\/td>\n2009<\/b><\/td>\n5.04%<\/td>\n2021<\/b><\/td>\n2.96%<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Source: <\/i>Freddie Mac<\/i><\/a><\/p>\n

2022 monthly average 30-year mortgage rate<\/h4>\n\n\n\n\n\n\n
January<\/b><\/td>\nFebruary<\/b><\/td>\nMarch<\/b><\/td>\nApril<\/b><\/td>\nMay<\/b><\/td>\nJune<\/b><\/td>\n<\/tr>\n
3.45%<\/td>\n3.76%<\/td>\n4.17%<\/td>\n4.98%<\/td>\n5.23%<\/td>\n5.52%<\/td>\n<\/tr>\n
July<\/b><\/td>\nAugust<\/b><\/td>\nSeptember<\/b><\/td>\nOctober<\/b><\/td>\nNovember<\/b><\/td>\nDecember<\/b><\/td>\n<\/tr>\n
5.41%<\/td>\n5.22%<\/td>\n6.11%<\/td>\n6.90%<\/td>\n6.58%<\/td>\n6.42%<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Source: <\/i>Freddie Mac<\/i><\/a><\/p>\n

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4. High mortgage rates could fall<\/h3>\n

On March 22, the Fed raised its benchmark interest rates by another 0.25%<\/a>, but it modified its guidance on future interest rate changes. The Fed now believes it no longer anticipates that \u201congoing rate increases will be appropriate to quell inflation.\u201d<\/p>\n

For homeowners and buyers making plans in 2023, this change in guidance means mortgage rates<\/a> should move lower at some point. Evangelou says she believes rates will simmer during 2023 \u2013 which will reduce homeowners\u2019 monthly payments.<\/p>\n

\u201cI will say that in the second half of the year, I expect mortgage rates to start falling down again,\u201d predicts Evangelou. \u201cThis can make home buying more affordable to many people. Usually, a rate close to the low range of 6% can make home buying affordable.\u201d<\/p>\n

Still, Shea suggests home buyers resist the urge to hold out for low interest rates.<\/p>\n

\u201cBecause the inventory is still low, when the rates come down, there’s going to be a lot more competition for the same amount of inventory, unless something happens,\u201d she says.<\/p>\n

\n I think there are opportunities over the next six months to a year to capitalize on. I think [buyers] need to recognize that \u2014 the interest rates \u2014 they can refinance out of those rates.<\/q>\n
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