Spring Market in DC 2023
The last market update was in the Fall and I said then as soon as I had a read on Spring, I would update. Here we are! Spring is springing, so is the market still dying a slow death or what?
When we left off in the Fall, things looked pretty abysmal. Mortgage rates were over 7%, and very little house buying was happening. Very little. My husband said several of the large regional and national builders he speaks with said they had stopped getting permits and had laid off a good bit of staff.
What did I say in the Fall? Well, I said it was anyone’s guess but I expected we would get right back to people living their lives and buying and selling again. But no, don’t just take my word for it, let’s go back to my video from Oct 5, 2022 because I don’t want to just tell you what I said, no, I want you to hear it for yourself: https://www.youtube.com/watch?v=yb3ifBOhSZ8&t=24s
The initial interest rate shock sent everyone out of the market, but that was a great time to buy because everyone was going to come back.
When clients asked what was expected to happen this spring, I said what I always say. See, this is my speech I’ve used for the last 15 years. “For some people the spring real estate market starts January 2. For some it starts after the Super Bowl. For the rest it starts when the weather gets warm.”
Now, here’s 2023 so what’s happening for these first couple months?
January was very much as slow as it usually is. Things were dead.
Then the Super Bowl happened. Usually the weekend of the Super Bowl it’s pretty dead. But that same weekend, even though the game was being played, something, this was happening.
There were open houses with 50-60 people attending.
There were multiple offers again.
There were pre-inspections again.
It’s back. The idea of dealing with another 2021 is totally miserable because it means there are going to be some very unhappy buyer clients. All of my clients right now are asking what I think is going to happen next. Since I was pretty good at reading the last crystal ball in October when I said that things would bounce back, and since I also was accurate in being one of the first in the area last April to call the beginning of the slowdown, I’m going to try my hand at it again.
There are a lot of people who were waiting to see what interest rates were going to do, but they can’t wait any longer. They need to buy a home. Life goes on and life has moved on from just last year for people.
There will be proportionally more buyers early in the Spring because they held off on buying for the last six months. This initial group will get into houses by mid-spring and then it will normalize, depending on interest rates.
You won’t have an unlimited supply of buyers in the market at 6 and 7% interest rates. Because even though rates are still historically low, people still feel like they missed something by not getting into a house when rates were 2.5%. These buyers also won’t be buying the junk that was thrown on the market either. Competition for homes that need no work is bigger than ever.
But here’s what you will have – more qualified buyers. People who have cash and who can afford to buy now with bigger down payments, or they have all cash and don’t give a rat’s butt about interest rates.
It’s going to get tougher, at least for a little bit, as we head into Spring. So buckle up for Covid Market 2.0, or maybe this is more like 3.0 and let’s get out there.