What's Next For Home Prices In 2023

The topic of home prices has been widely debated over the past year, with some predicting a massive drop in prices similar to the 2008 recession, while others forecast slight appreciation or depreciation depending on the region. As we approach the spring real estate market, experts are continuing to predict what will happen with home prices in the coming year.

Selma Hepp, Chief Economist at CoreLogic, notes that:

“While 2023 kicked off on a more optimistic note for the U.S. housing market, recent mortgage rate volatility highlights how much uncertainty remains. Nevertheless, the continued shortage of for-sale homes is likely to keep price declines modest, which are projected to top out at 3% peak to trough.”

Pulsenomics surveys a panel of over 100 economists, investment strategists, and housing market analysts every quarter, asking for their five-year expectations for future home prices in the United States. Their most recent survey results indicate a projected slight price depreciation in the housing market this year, followed by steady appreciation.

If you're wondering whether or not to buy a home this spring, here are three reasons why you should consider making a move:

1. Buying a home helps you escape the cycle of rising rents. Over the past several decades, the median price of rent has consistently risen, making owning a home a more affordable option.

2. Homeownership is a hedge against inflation. When you buy a home with a fixed-rate mortgage, you secure your housing payment, protecting yourself from potential rent increases.

3. Homeownership is a powerful wealth-building tool. The average net worth of a homeowner is $255,000 compared to $6,300 for a renter.

Overall, while slight price depreciation is projected in the housing market this year, followed by steady appreciation, it's important to make the decision to purchase a home with all the facts and with the help of an expert real estate professional.