Experts Forecast a Turnaround in the Housing Market in 2023

The San Antonio housing market has gone through a lot of change recently, and much of that was a result of how quickly mortgage rates rose last year.   Now, as we move through 2023, there are signs things are finally going to turn around. Home price appreciation is slowing from the recent frenzy, mortgage rates are coming down, inflation is easing, and overall market activity is starting to pick up. All of that’s great news for the housing market this year. Here’s what experts are saying. Cristian deRitis, Deputy Chief Economist, Moody’s Analytics: “The current state of the housing market is that it is certainly in transition.” Susan Wachter, Professor of Real Estate and Finance, University of Pennsylvania’s Wharton School: “Housing is going to ease up. I think 2023 will be a turnaround year.” Lawrence Yun, Chief Economist, National Association of Realtors (NAR): “Mortgage rates have fallen in the recent past weeks, so I’m very hopeful that the worst in home sales is probably coming to an end.” Robert Dietz, Chief Economist and Senior Vice President, National Association of Home Builders (NAHB): “. . . it appears a turning point for housing lies ahead. In the coming quarters, single-family home building will rise off of cycle lows as mortgage rates are expected to trend lower and boost housing affordability.”   Bottom Line If you’re thinking about making a move this year, a turnaround in the San Antonio housing market could be exactly what you’ve been waiting for. Let’s connect to talk about the latest trends in San Antonio, TX.         Should You Rent Your House or Sell Your Home in San Antonio, TX? If you’re a San Antonio homeowner ready to make a move, you may be thinking about using your current house as a short-term rental property instead of selling it. A short-term rental (STR) is typically offered as an alternative to a hotel, and they’re an investment that’s gained popularity in recent years. According to a Harris Poll survey, 28% of homeowners have considered using a rental service to temporarily rent out their home for additional income. Owning a short-term rental can be a tempting idea, but you may find the reality of being responsible for one difficult to take on. Here are some of the challenges you could face if you rent out your house instead of selling it. A Short-Term Rental Comes with Responsibilities Successfully owning and renting a house takes work. Think through your ability to make that commitment, especially if you plan to use a platform that advertises your rental listing. Most of them have specific requirements hosts have to meet, and it takes a lot of work. A recent article from Bankrate explains: “Managing a rental property can be time-consuming and challenging. Are you handy and able to make some repairs yourself? If not, do you have a network of affordable contractors you can reach out to in a pinch? Consider whether you want to take on the added responsibility of being a landlord, which means screening tenants and fielding issues, among other responsibilities, or paying for a third party to take care of things instead.” Not only is there the upfront time and cost of owning a short-term rental, but there are also risks that could come up for you down the road. Investopedia warns: “Risks of hosting include renting your place to rude guests, theft or damaged property, complaints from neighbors, and potential regulatory violations depending on your location.” There’s a lot to consider before taking the leap and converting your house into a short-term rental. If you aren’t ready for the work it takes, it could be wiser to sell instead. Your House May Not Be Ideal for Your Rental Goals Not every house ends up being a profitable short-term rental either. One of the biggest factors is where your home is located. The less likely your neighborhood is to be a travel destination, the fewer requests you should expect from potential renters—and that impacts your bottom line. An article from the National Association of Realtors (NAR) advises: “When it comes to the viability of profitable STRs . . . consider factors like location, amenities, and whether the property is appealing. Most people seek STRs in locations where they vacation, so proximity to attractions is important. Likewise, the property should cater to a variety of travelers.” It’s smart to do your homework and learn how much rentals in your area go for, how much business they get throughout the year, and how this compares to your goals. Bottom Line Converting your home into a short-term rental isn’t a decision you should make without doing your research. To decide if selling your house in San Antonio is a better alternative, let’s connect today.       Where Will You Go If You Sell? You Have Options. There are plenty of good reasons you might be ready to move. No matter your motivations, before you list your current house, you need to consider where you’ll go next. In today’s market, it makes sense to explore all your options. That includes both homes in San Antonio, TX that have been lived in before as well as newly built ones. To help you decide which is right for you, let’s compare the benefits of each. Regardless of which option you choose to explore, working with a trusted real estate professional throughout the process is essential. The Benefits of Newly Built Homes First, let’s look at the benefits of purchasing a newly constructed home in San Antonio. With a brand-new house, you’ll be able to: 1. Build your dream home If you build a home from the ground up, you’ll have the option to select the custom features you want, including appliances, finishes, landscaping, layout, and more. Bankrate puts it like this: “Building means customizing. . . . instead of wishing your home had a certain kind of flooring, a sunroom or some other special amenity, you’ll be able to tailor the property to your exact needs. You also won’t be limited to a specific location or neighborhood.” 2. Take advantage of builder concessions In today’s market, a lot of home builders are working hard to sell their current inventory before they add more to their mix. That means many of them are offering concessions and are more willing to negotiate with buyers. That could work to your advantage in the process. 3. Minimize home repairs Many builders offer a warranty, so you’ll have peace of mind on unlikely repairs. Plus, you won’t have as many little improvement projects to tackle. As realtor.com says: “. . . if something goes wrong with your new home, not only are there likely some manufacturer warranties in place, but many builders also include additional home warranties . . .” 4. Take advantage of energy efficiency When building a home, you can choose brand-new, energy-efficient options to help lower your utility costs, protect the environment, and reduce your carbon footprint. The Benefits of Existing Homes Now, let’s compare those to the perks that come with buying an existing home. With a pre-existing home, you can: 1. Explore a wider variety of home styles and floorplans With decades of homes to choose from, you’ll have a broader range of floorplans and designs available. 2. Appreciate that lived-in charm The character of older homes is hard to reproduce. If you value timeless craftsmanship or design elements, you may prefer an existing home. 3. Join an established neighborhood Existing homes give you the option to get to know the neighborhood, community, or traffic patterns before you commit. Plus, they have more developed landscaping and trees, which can give you additional privacy and curb appeal. 4. Move in faster If you have a short timeframe to move or you just don’t want the process to take several months while your home is under construction, buying an existing home might make sense for you. U.S. News explains: “When you’re choosing a home, existing or new, you should also consider how long it might take to move into that home. Just because you have a contract doesn’t mean that your new home will be completed (or even started) at the time you agree to the purchase. It can be a struggle waiting for the walls to go up as you wonder what your home will become.” When thinking about where you’ll go after you sell your house, remember your options. As you start your search, think about what’s most important to you. By working with a trusted real estate agent, you can be confident you’re making the most educated, informed decision. Bottom Line If you have questions about the options in San Antonio, TX, let’s discuss what's available and what's right for you, so you’re ready to make your next move with confidence.         Lower Mortgage Rates Are Bringing Buyers Back to the San Antonio Housing Market As mortgage rates rose last year, activity in the housing market slowed down. And as a result, homes started seeing fewer offers and stayed on the market longer. That meant some homeowners decided to press pause on selling. Now, however, rates are beginning to come down—and buyers are starting to reenter the market. In fact, the latest data from the Mortgage Bankers Association (MBA) shows mortgage applications increased last week by 7% compared to the week before. So, if you’ve been planning to sell your house but you’re unsure if there will be anyone to buy it, this shift in the market could be your chance. Here’s what experts are saying about buyers returning to the market as we approach spring. Mike Fratantoni, SVP and Chief Economist, MBA: “Mortgage rates are now at their lowest level since September 2022, and about a percentage point below the peak mortgage rate last fall. As we enter the beginning of the spring buying season, lower mortgage rates and more homes on the market will help affordability for first-time homebuyers.” Lawrence Yun, Chief Economist, National Association of Realtors (NAR): “The upcoming months should see a return of buyers, as mortgage rates appear to have already peaked and have been coming down since mid-November.” Thomas LaSalvia, Senior Economist, Moody’s Analytics: "We expect the labor market to remain robust, wages to continue to rise—maybe not at the pace that they did during the pandemic, but that will open up some opportunity for folks to enter homeownership as interest rates stabilize a bit." Sam Khater, Chief Economist, Freddie Mac: “Homebuyers are waiting for rates to decrease more significantly, and when they do, a strong job market and a large demographic tailwind of Millennial renters will provide support to the purchase market.” Bottom Line If you’ve been thinking about making a move, now’s the time to get your house ready to sell. Let’s connect so you can learn about buyer demand in our area the best time to put your house on the market.     Want To Sell Your House? Price It Right. Last year, the housing market slowed down in response to higher mortgage rates, and that had an impact on home prices. If you’re thinking of selling your house soon, that means you’ll want to adjust your expectations accordingly. As realtor.com explains: “. . . some of the more prominent pandemic trends have changed, so sellers might wish to adjust accordingly to get the best deal possible.” In a more moderate market, how you price your house will make a big difference to not only your bottom line, but to how quickly your house could sell. And the reality is, homes priced right are still selling in today’s market. Why Pricing Your House Appropriately Matters Especially today, your asking price sends a message to potential buyers. If it’s priced too low, you may leave money on the table or discourage buyers who may see a lower-than-expected price tag and wonder if that means something is wrong with the home. If it’s priced too high, you run the risk of deterring buyers. When that happens, you may have to lower the price to try to reignite interest in your house when it sits on the market for a while. But be aware that a price drop can be seen as a red flag by some buyers who will wonder what that means about the home. To avoid either headache, price it right from the start. A real estate professional knows how to determine that ideal asking price. They balance the value of homes in your neighborhood, current market trends, buyer demand, the condition of your house, and more to find the right price. This helps lead to stronger offers and a greater likelihood your house will sell quickly. The visual below helps summarize the impact your asking price can have: Bottom Line Homes that are priced at current market value are still selling. To make sure you price your house appropriately, maximize your sales potential, and minimize your hassle, let’s connect.

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Want To Sell Your House? Price It Right.

Last year, the housing market slowed down in response to higher mortgage rates, and that had an impact on home prices. If you’re thinking of selling your house in San Antonio soon, that means you’ll want to adjust your expectations accordingly. As realtor.com explains: “. . . some of the more prominent pandemic trends have changed, so sellers might wish to adjust accordingly to get the best deal possible.” In a more moderate market, how you price your house will make a big difference to not only your bottom line, but to how quickly your house could sell. And the reality is, homes priced right are still selling in today’s market. Why Pricing Your House Appropriately Matters Especially today, your asking price sends a message to potential buyers.   If it’s priced too low, you may leave money on the table or discourage buyers who may see a lower-than-expected price tag and wonder if that means something is wrong with the home.   If it’s priced too high, you run the risk of deterring buyers. When that happens, you may have to lower the price to try to reignite interest in your house when it sits on the market for a while. But be aware that a price drop can be seen as a red flag by some buyers who will wonder what that means about the home.   To avoid either headache, price it right from the start. A real estate professional knows how to determine that ideal asking price. They balance the value of homes in your neighborhood, current market trends, buyer demand, the condition of your house, and more to find the right price. This helps lead to stronger offers and a greater likelihood your house will sell quickly.   The visual below helps summarize the impact your asking price can have:     Bottom Line Homes that are priced at current market value in San Antonio are still selling. To make sure you price your house appropriately, maximize your sales potential, and minimize your hassle, let’s connect.           Today’s San Antonio Housing Market Is Nothing Like 15 Years Ago There’s no doubt today’s San Antonio housing market is very different than the frenzied one from the past couple of years. In the second half of 2022, there was a dramatic shift in real estate, and it caused many people to make comparisons to the 2008 housing crisis. While there may be a few similarities, when looking at key variables now compared to the last housing cycle, there are significant differences. In the latest Real Estate Forecast Summit, Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), drew the comparisons below between today’s housing market and the previous cycle: Looking at the facts, it’s clear: today is very different than the San Antonio housing market of 15 years ago. There’s Opportunity in Real Estate Today And in today’s market, with inventory rising and less competition from other San Antonio buyers, there’s opportunity right now. According to David Stevens, former Assistant Secretary of Housing: “So be advised…this may be the one and only window for the next few years to get into a buyer’s market. And remember…as the Federal Reserve data shows…home prices only go up and always recover from recessions no matter how mild or severe. Long term homeowners should view this market…right now…as a unique buying opportunity.” Bottom Line Today’s housing market is nothing like the real estate market 15 years ago. If you’re a San Antonio buyer right now, this may be the chance you’ve been waiting for.           3 Best Practices for Selling Your House in San Antonio This Year A new year brings with it the opportunity for new experiences. If that resonates with you because you’re considering making a move, you’re likely juggling a mix of excitement over your next home and a sense of attachment to your current one. A great way to ease some of those emotions and ensure you’re feeling confident in your decision is to keep these three best practices in mind. 1. Price Your Home Right The housing market shifted in 2022 as mortgage rates rose, buyer demand eased, and the number of homes for sale grew. As a seller, you’ll want to recognize things are different now and price your house appropriately based on where the market is today. Greg McBride, Chief Financial Analyst at Bankrate, explains: “Price your home realistically. This isn’t the housing market of April or May, so buyer traffic will be substantially slower, but appropriately priced homes are still selling quickly.” If you price your house too high, you run the risk of deterring buyers. And if you go too low, you’re leaving money on the table. Brandon Grell at Grell Realty Group can help determine what your ideal asking price should be. 2. Keep Your Emotions in Check Today, homeowners are living in their houses longer. According to the National Association of Realtors (NAR), since 1985, the average time a homeowner has owned their home has increased from 5 to 10 years (see graph below): This is several years longer than what used to be the historical norm. The side effect, however, is when you stay in one place for so long, you may get even more emotionally attached to your space. If it’s the first home you bought or the house where your loved ones grew up, it very likely means something extra special to you. Every room has memories, and it’s hard to detach from the sentimental value. For some homeowners, that makes it even harder to negotiate and separate the emotional value of the house from fair market price. That’s why you need Brandon Grell at Grell Realty Group to help you with the negotiations along the way. 3. Stage Your Home Properly While you may love your decor and how you’ve customized your home over the years, not all San Antonio buyers will feel the same way about your design. That’s why it’s so important to make sure you focus on your home’s first impression so it appeals to as many buyers as possible. As NAR says: “Staging is the art of preparing a home to appeal to the greatest number of potential buyers in your market. The right arrangements can move you into a higher price-point and help buyers fall in love the moment they walk through the door.” Buyers want to envision themselves in the space so it truly feels like it could be their own. They need to see themselves inside with their furniture and keepsakes – not your pictures and decorations. A real estate professional can help you with tips to get your house ready to sell In San Antonio. Bottom Line If you’re considering selling your house in San Antonio, let’s connect so you have the help you need to navigate through the process while prioritizing these best practices.           Planning To Sell Your House in San Antonio? It’s Critical To Hire a Pro. With higher mortgage rates and moderating buyer demand, conditions in the housing market are different today. And if you’re thinking of selling your house in San Antonio, it’s important to understand how the market has changed and what that means for you. The best way to make sure you’re in the know is to work with a trusted housing market expert. Here are five reasons working with a professional can ensure you’ll get the most out of your sale. 1. A Real Estate Advisor Is an Expert on Market Trends in San Antonio Leslie Rouda Smith, 2022 President of the National Association of Realtors (NAR), explains: "During challenging and changing market conditions, one thing that's calming and constant is the assurance that comes from a Realtor® being in your corner through every step of the home transaction. Consumers can rely on Realtors®' unmatched work ethic, trusted guidance and objectivity to help manage the complexities associated with the home buying and selling process.” An expert real estate advisor has the latest information about national trends and your local area too. More importantly, they’ll know what all of this means for you so they’ll be able to help you make a decision based on trustworthy, data-bound information. 2. A Local Professional Knows How To Set the Right Price for Your House in San Antonio Home price appreciation has moderated this year. If you sell your house on your own, you may be more likely to overshoot your asking price because you’re not as aware of where prices are today. If you do, you run the risk of deterring buyers or seeing your house sit on the market for longer. Real estate professionals provide an unbiased eye when they help you determine a price for your house. They’ll use a variety of factors, like the condition of your home and any upgrades you’ve made, and compare your house to recently sold homes in your area to find the best price for today’s market. These steps are key to making sure it’s set to move as quickly as possible. 3. A Real Estate Advisor Helps Maximize Your Pool of Buyers Since buyer demand has cooled this year, you'll want to do what you can to help bring in more buyers. Real estate professionals have a large variety of tools at their disposal, such as social media followers, agency resources, and the Multiple Listing Service (MLS) to ensure your house gets in front of people looking to make a purchase. Investopedia explains why it’s risky to sell on your own without the network an agent provides: “You don’t have relationships with clients, other agents, or a real estate agency to bring the largest pool of potential buyers to your home.” Without access to the tools and your agent’s marketing expertise, your buyer pool – and your home’s selling potential – is limited. 4. A Real Estate Expert Will Read – and Understand – the Fine Print Today, more disclosures and regulations are mandatory when selling a house. That means the number of legal documents you’ll need to juggle is growing. NAR explains it like this: “Selling a home typically requires a variety of forms, reports, disclosures, and other legal and financial documents. . . . Also, there’s a lot of jargon involved in a real estate transaction; you want to work with a professional who can speak the language.” A real estate professional knows exactly what all the fine print means and how to work through it efficiently. They’ll help you review the documents and avoid any costly missteps that could occur if you try to handle them on your own. 5. A Trusted Advisor Is a Skilled Negotiator In today’s market, buyers are also regaining some negotiation power as bidding wars ease. If you sell without a professional, you’ll also be responsible for any back-and-forth. That means you’ll have to coordinate with: The buyer, who wants the best deal possible The buyer’s agent, who will use their expertise to advocate for the buyer The inspection company, which works for the buyer and will almost always find concerns with the house The appraiser, who assesses the property’s value to protect the lender Instead of going toe-to-toe with all the above parties alone, lean on an expert. They’ll know what levers to pull, how to address everyone’s concerns, and when you may want to get a second opinion. Bottom Line Don’t go at it alone. If you’re planning to sell your house in San Antonio this winter, let’s connect so you have an expert by your side to guide you in today’s market.         Confused About What’s Going on in the Housing Market? Lean on a Professional. If you’re thinking about buying or selling a home, you probably want to know what’s really happening with home prices, mortgage rates, housing supply, and more. That’s not an easy task considering how sensationalized headlines are today. Jay Thompson, Real Estate Industry Consultant, explains: “Housing market headlines are everywhere. Many are quite sensational, ending with exclamation points or predicting impending doom for the industry. Clickbait, the sensationalizing of headlines and content, has been an issue since the dawn of the internet, and housing news is not immune to it.” Unfortunately, when information in the media isn’t clear, it can generate a lot of fear and uncertainty in the market. As Jason Lewris, Cofounder and Chief Data Officer at Parcl, says: “In the absence of trustworthy, up-to-date information, real estate decisions are increasingly being driven by fear, uncertainty, and doubt.” But it doesn’t have to be that way. Buying or selling a home in San Antonio is a big decision, and it should be one you feel confident making. To help you separate fact from fiction and get the answers you need, lean on a local real estate advisor. A trusted expert is your best resource to understand what’s happening at the national and local levels. They’ll be able to debunk the headlines using data you can trust. And using their in-depth knowledge of the industry, they’ll provide context so you know how current trends compare to the normal ebbs and flows in the industry, historical data and more. Then, to make sure you have the full picture, they’ll tell you if your local area is following the national trend or if they’re seeing something different in your market. Together, you’ll use all of that information to make the best possible decision for you. After all, making a move is a potentially life-changing milestone. It should be something you feel ready for and excited about. And that’s where an agent comes in. Bottom Line If you have questions about the headlines or what’s happening in the San Antonio housing market today, let’s connect so you have expert insights and advice on your side.

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Have Home Values Hit Bottom?

Whether you’re already a homeowner or you’re looking to become one, the recent headlines about home prices may leave you with more questions than answers. News stories are talking about home prices falling, and that’s raising concerns about a repeat of what happened to prices in the crash in 2008.One of the questions that’s on many minds, based on those headlines, is: how much will home prices decline? But what you may not realize is expert forecasters aren’t calling for a free fall in prices. In fact, if you look at the latest data, there’s a case to be made that the biggest portion of month-over-month price depreciation nationally may already behind us – and even those numbers weren’t significant declines on the national level. Instead of how far will they drop, the question becomes: have home values hit bottom? Let’s take a look at the latest data from several reputable industry sources (see chart below):The chart above provides a look at the most recent reports from Case-Shiller, the Federal Housing Finance Agency (FHFA), Black Knight, and CoreLogic. It shows how, on a national scale, home values have changed month-over-month since January 2022. November and December numbers have yet to come out.Let’s focus in on what the red numbers tell us. The red numbers are the change in home values over the last four months that have been published. And if we isolate the last four months, what the data shows is, in each case, home price depreciation peaked in August.While that doesn’t guarantee home price depreciation has hit bottom, it confirms prices aren’t in a free fall, and it may be an early signal that the worst is already behind us. As the numbers for November and December are released, data will be able to further validate this national trend.Bottom LineHome prices month-over-month have depreciated for the past four months on record, but there’s a strong case to be made that the worst may be behind us. If you have questions about what’s happening with home prices in our local market, let’s connect.

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