We’re already a month into 2023. What does the real estate market look like? What’s the latest US housing market news for investors today?
As we start to move deeper into 2023, US housing market experts are keeping their eyes peeled for any slight market movements. The news is peppered with reports that the US housing market is cooling down and is getting more stable, giving both sellers and buyers a healthier balance.
In 2022, we saw property prices hit record highs, mortgage rates go way beyond the initially forecasted 5.00% high, and high inflation rates that affected consumer behavior. Some news outlets have even talked about the possibility of a real estate housing market crash in the US as well as a looming economic recession.
If you have been following Mashvisor for the past year, you know that we reported on mortgage rate movements, cooling markets, and, more recently, different forecasts and predictions for 2023.
Now that we’re done with the first month of the year, how is the national real estate market shaping up? Is there something positive that we can look forward to in the US housing market news for this month?
We will go over three very important things in this article. Namely, housing supply, property prices, and mortgage rates. All three factors are major determinants of how healthy a real estate market is and if it’s worth investing in it.
Housing Market Kicks Off 2023 With Less Inventory Than Expected
The first thing we will look at is the US housing supply. It is no longer news that the demand for housing has consistently outpaced the inventory in nearly every real estate market in the US for quite some time now.
CNBC recently reported that housing inventory went up by 10% year-over-year. However, despite that significant rise in supply, we are still only at 2.9 months’ worth of overall inventory. Experts agree that a healthy and balanced market should have anywhere between 4 to 6 months’ worth of existing housing supply.
During the pandemic, we saw how housing supply dwindled in the US housing market as the demand exceeded new supply dramatically. As we start settling back to normal, new listings started popping up in different marketplaces. Those that were withdrawn over the holidays are back, with a lot of them listed at lower prices.
One thing to note is that the demand is significantly lower in January 2023 compared to the past few years of the same month. Inventory is expected to go up over the next few weeks and months if this keeps up.
Back in June 2022, inventory climbed so fast that it seemed we will get to start the new year strong, but it fell short of most people’s expectations. The year 2022 ended with less than 500,000 single-family listings. However, because demand is lower at this point, buyers and investors have more choices now than they’ve had in years.
To date, we have a national inventory that has 67% more homes for sale compared to a year ago.
Top 10 Locations in the US Housing Market With the Most Listings for Sale
According to Mashvisor’s January 2023 data, these are the top ten housing markets in the US that have the most number of listings for sale.
- Las Vegas NV: 4,736
- New York NY: 4,398
- Miami FL: 4,369
- San Antonio TX: 3,620
- Los Angeles CA: 3,002
- Atlanta GA: 2,953
- Chicago IL: 2,935
- Philadelphia PA: 2,726
- Tampa FL: 2,299
- Fort Worth TX: 2,211
Active listings in Las Vegas NV as seen on Mashvisor, as of 3 February 2022.
Property Prices Are Dropping, But Don’t Celebrate Just Yet
The law of supply and demand dictates that the prices of goods and services are relative to the relationship between supply and demand. This simply means that if the demand is greater than the supply, the prices go up. But if the supply exceeds the demand, the prices go down.
This also applies to real estate. As the news of an increase in supply and less demand continues to spread, we are seeing many markets starting to cool down and drop their prices. However, this is not a blanket statement. While many sellers are lowering their asking prices on properties, this is not happening across the board.
What’s true is that a majority of the US housing market is cooling down. This means that the rate of increase in property prices has slowed down compared to its meteoric rise in 2022. Prices are still going up incrementally, just not as dramatically.
Other markets, however, have had their prices go down. Overall, we have seen a 1% decrease in median property prices for single-family units across the nation. However, a lot of experts are anticipating a rebound in the next few weeks, which is typical every year. With springtime fast approaching, prices will inevitably go up.
Top 10 Locations in the US Housing Market With the Lowest Property Prices
We took a look at Mashvisor’s January 2023 data and found that the following locations have the cheapest median property prices.
- Inkster MI: $123,450
- Brooklyn MS: $126,780
- Maple Heights OH: $131,219
- Sigourney IA: $131,580
- East Palestine OH: $134,288
- Saint Ann MO: $136,180
- Ambridge PA: $136,620
- Lincoln Park MI: $137,391
- Newton Falls OH: $137,890
- Fairfield AL: $138,600
Mortgage Rates Are Also Declining, But How Far Down Will It Go?
In other US housing market news, mortgage rates are also seemingly going down.
At the time of writing, the national average rate for a 30-year fixed-rate mortgage is 6.36%, falling 7 basis points from last week. This is a far cry from the national average, which peaked at 7.24% in November 2022. The 30-year refinance rates have also fallen by 6 basis points from a week ago to 6.41% today.
We’ve heard the news talk about how mortgage rates have severely impacted housing affordability. A lot of news outlets have reported that mortgage rates have forced potential home buyers and real estate market investors to put their plans on hold.
Markets may have cooled down, with some areas actually seeing lower prices, but high mortgag rates are a turn-off for a lot of would-be homeowners and investors at this time. But most of us will also remember that mortgage rates became steadier and a lot more stable in Q4 2022 after going on a crazy roller coaster ride for most of the year.
Industry experts are quite optimistic about how mortgage rates will behave this year. Although it still remains north of 6.00%, we will likely see a more consistent and steadier movement in rates throughout the year. This can lead to greater confidence in making buying and investing decisions for real estate investors looking for investment properties.
Wrapping It Up
As far as US housing market news is concerned, it looks like we’re off to a good start. Considering the factors involved, the real estate market is taking baby steps to get back on its pre-pandemic track.
If you’re into real estate investing, consider using a platform like Mashvisor to help you find the best investment opportunities in any market of your choice across the country.
Get started on your 7-day free trial with Mashvisor today on your way to a thriving real estate investing career.