Real estate can be a very tough market to forecast, and what customers demand and what is trending can change drastically from year to year. So if you are a potential buyer or seller, what can you expect from the market in 2023?
We will look at emerging trends and what you can expect might happen in 2023. Investment in real estate can be costly, and for many people, it might be their life savings or something they have worked towards for a long time. Better knowledge and forecast of the market helps them make better and more well-informed decisions.
Change post COVID
In the last decade, the most notable change in most markets was seen during the COVID pandemic, when a lot of the world came to a standstill, and we went into a period of recession that is still ongoing and has lingering effects. With high levels of inflation and many people being let go from work or having seen a decrease in their wages, it was difficult to invest much money in things such as houses.
One thing differentiating the housing market from most other markets is the limited supply in most areas and the demand. People are always going to demand houses, and even if short-term demand might fall due to events like the pandemic, demand will most probably increase again in the long run. Due to all this, the housing market stayed relatively higher in prices across the board.
What to expect going into 2023?
Consumer demand and consumption depend heavily on factors like interest rates, and going into 2023, interest rates are expected to increase a bit. Post-pandemic, the interest rates were relatively low, which made it easier for people to invest in houses and kept the demand for houses relatively stable.
Over the last couple of years, prices of houses have remained relatively stable and haven’t seen much change, and even with fewer overall sales, sellers have been adamant about their prices. This trend can be expected to continue, and many experts predict that there will be increased supply in 2023 for houses due to fewer houses being sold at the prices they are at. In many places, house affordability remains a pressing issue and an issue many families face.
Market for renters
A big part of the real estate market is the renter market, and people often rent instead of buying a house for many different reasons. Renters can expect an increase in rents within legal ranges as inflation has been very high worldwide. Overall a general change in recent years has seen a rise in rental demand compared to buying real estate. As many people can’t afford houses in this market, they tend to opt for renting instead of buying, and this increases the overall demand.
So for property owners renting out their properties, there isn’t a lack of supply, which then keeps the price higher.
Commercial real estate
The trends for commercial real estate markets are pretty similar, as the global recession has impacted almost all markets. With drops in revenue across the board, many firms and businesses saw it challenging to keep up with rental demands for their properties. With work-from-home becoming a popular trend, companies worldwide have had to consider that as a factor when looking at the office personnel and their number of workers.
Going into 2023, many industries have stabilized and reached levels closer to pre-pandemic, like the medical sector, but we have seen new normals with permanent changes in the market.
Consulting local realtors and experts
It’s important to remember that market trends and demand can change a lot depending on where you are and what country you are in. Even within cities, different areas can have wildly differing real estate markets.
On top of all that, real estate is a market that can be affected by many external factors and political situations, so staying current is always essential. Local realtors and experts can be your best bet when it comes to knowing all the recent news and updates, as they are experts at this.
Depending on your location, you should look for realtors who know that market’s ins and outs and can guide you properly. For example, if you live in South Korea, realty experts like Hometown Realty in Korea can guide you better with what you might want to know about the South Korean housing market.