Northern Virginia realtors say 2023 could bring more balance to the housing market.
Sharat Ahuja, team leader and realtor for the Terra Firma Group at Long and Foster Realtors in Fairfax, predicts a “little bit more” of a balanced market between buyers and sellers, with fewer homes selling this year compared to last year.
Inventories could continue to be on the “lower side” of the market, according to Ahuja, which will put pressure on prices but likely won’t lead to a decline. Ahuja says buyers will “outnumber” sellers and will be able to negotiate terms “much better” than in past years. Homebuyers may start looking at Adjustable-Rate Mortgages, rather than 30-year fixed rates, to help them buy.
Home sellers can expect the buyer demand to be high and should expect to get close to their asking prices if the houses are “priced well,” Ahuja says. Buyers can expect the normal competition. Although inventory “will continue to be low,” Ahuja says buyers will be able to negotiate both prices and terms, such as home inspections and appraisals.
The best time to sell one’s house is “now,” according to Ahuja, since the new year has just begun and the demand for houses is widespread.
“Consider putting your home on the market because you can avoid the risk of a potential recession down the road,” Ahuja says.
If a buyer can afford a house at the moment, Ahuja recommends buying now since there is less competition. If a buyer can’t afford to buy now, he should wait until interest rates go down.
Rebecca McCullough, an associate broker for McEnearney Associates in Alexandria, predicts housing prices this year will be “relatively flat,” with inventory remaining a challenge.
McCullough says she would like to see a “little bit more” of a balanced market, with sellers being able to get their houses on the market and buyers having more options from which to choose.
Another difficulty sellers could face will be what a buyer can afford, based on where interest rates are. She says people are “still licking their wounds” from last year’s interest rate hikes.
“The one thing we can clearly see is that rising mortgage rates are depressing overall residential real estate market activities across all product types and in all Northern Virginia jurisdictions and this will continue throughout 2023,” says a 2023 Region Market Forecast done by the Northern Virginia Association of Realtors and Terry Clower, director of the Center for Regional Analysis at George Mason University.
“We are expecting strong markets in 2024-25,” McCullough says. “I think this is a great year for buyers: you buy what you can afford and if rates go down, you refinance.”
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