It was a wild ride for the U.S. housing market last year. So, what’s in store for 2023? Economists and the CEO of the largest mortgage lender weigh in on what to expect this year.
When it comes to the housing market, are we in for another wild ride? CNN asked Chief Economist Mark Zandi from Moody’s Analytics.
"Next 12, 18, 24 months in housing is going to be, it's going to be difficult,“ Zandi told CNN. "House prices rose very strongly during much of the pandemic, and we're just retracing some of those price gains."
If you remember, last year mortgage rates doubled, sales plummeted, and many would-be buyers and sellers were sidelined.
In recent months, home prices have cooled from their blockbuster gains that happened between the Spring of 2020 and 2022. Back then, home prices rose nearly 40%.
Zandi said the market will be determined by inventory, the broader economy, and mortgage rates.
According to Freddie Mac, the 30-year fixed rate mortgage averaged 6.33% in the week ending January 12, 2023. That’s down from 7.08% last fall, but well above 3.45% from a year ago.
The CEO of Rocket Mortgage, Jay Farner, said relatively high mortgage rates have caused homeowners to reconsider selling their homes. That’s leading to higher competition for fewer houses on the market.
I wouldn't say it's necessarily a buyer's market yet, but I would say it's a pretty even market between buyer and seller," Farner said.