Analysts are all over the board when trying to predict exactly where the real estate market is headed. From the team at JP Morgan that is guessing a 4% decline in 2023 to Goldman Sachs who is saying housing prices could drop by 7.5% there is a large range of thinking by economists. Corelogic is the most optimistic estimating a drop of 2.8% between November 2022 and November 2023. These numbers are national estimates. I think for us in San Diego one key to consider is we still have a large housing shortage and strong underlying demand which will limit the extent of home price depreciation in our area.
The analysts are mostly in agreement that in 2024 interest rates should start coming back down and sales will pick up if inflation cools off as predicted. Until then real estate sales may be slower however I think there are already some deals to be found for buyers who know what they want and understand they can refinance in the future when the rates go down. You marry the home and date the rate!
For more thoughts on the next five years in real estate read this interesting article on Capital.com.