Baltimore Real Estate: 2023 Mid-Year Market Predictions
“What’s going on in Baltimore real estate,” is a question we get asked daily! Now that summer vacations are coming to a close and we’re all settling into our back-to-school routines, many are beginning to look at the market again and re-evaluate their plans.
This year has been interesting, to say the least, and the shifts from the fast-paced pandemic to now have left homeowners with more confusion than clarity.
We know the BIG question on everyone's mind is, “What should we expect moving forward with the housing market?”
So, let’s unpack that…
Your Home Group belongs to the largest real estate coaching company in the world! Industry expert, Brian Buffini, studies the real estate market and is usually right on with future predictions.
We recently attended a webinar: Brian Buffini's Bold Predictions 2023: Mid-Year Update, where he interviewed David Stevens who is the former CEO of the Mortgage Bankers Association. The conversation was focused on interest rates, inflation and where the market will be heading in 2024 and beyond.
(Watch the replay for more information)
In summary, what we learned is that all current signs are encouraging! Below we’ve outlined some of our top takeaways, as well as what trends we’re seeing play out locally, here in Baltimore.
1. Nationwide Equity is HIGH!
We typically hear from buyers that they are waiting for the market to crash and there are zero signs that is going to occur. There are many homeowners who are sitting on huge equity positions who want to move but are waiting for rates to drop. We have the largest number of millennials who are entering the stage of home purchasing and its the largest group ever, even bigger than the baby boomer wave. As rates will start to fall and more homes hit the market the Baltimore buyer pool is ready to grab them and home prices will only continue to climb in the years to come.
2. Rent Prices are Rising
With so many of us focused on the housing market, it’s common to turn a blind eye to the rental world. Even as home prices increase, the price of renting is not far behind. There are nearly 3 million households that are making over $150,000 a year that are still renting. (The Wallstreet Journal) Renting a home or apartment in a desirable area can be almost as expensive as a monthly mortgage. So, don’t send your money down the drain paying a landlord’s rent—invest in your own property instead!
Pro Tip: We suggest buying your dream Baltimore home when the time is right—renting your rate—and refinancing once the rates come down. To learn more about whether this method is a good fit for you, contact Wendy or Megan for details.
3. Baltimore Inventory Is at an All-Time Low
Low inventory has continued to put upward pressure on prices with many local markets hitting new record highs this summer. Homes continue to sell quickly with half selling in a week or less, nearly as fast as during the height of the pandemic market.
View the complete Baltimore Metro Report - June 2023
3. Mortgage Rates Are Predicted to Drop to the 5.5% Range
The topic everyone is waiting for—when will the mortgage rates drop? Experts predict the mortgage rates to gently ease through the rest of the year, rolling into 2024.
“Be prepared to jump on a dip in rates.” – Robert Frick | Corporate Economist, Navy Federal Credit Union
“With the rate of inflation decelerating, rates should gently decline over the course of 2023.” – Sak Khater | Freddie Mac Chief Economist
“Mortgage rates will drop—with the 30-year fixed mortgage rate progressively falling to 6.0% this year and to 5.6% in 2024.” – Lawrence Yun | National Association of Realtors® Chief Economist
“Our forecast is for a 30-year mortgage rate to be closer to about 5.5% by the end of this year and drop a little lower next year.” – Michael Fratantoni | Chief Economist & Senior Vice President of Research, Mortgage Bankers Association
However, the current market is at a standstill due to a continued shortage of inventory. Current homeowners are hesitant to enter the market due to today’s increased rates, but this is predicted to change once the rates lower to a more digestible percentage. Experts are predicting the market to kick back into high gear once rates reach the 5.5% range.
At the end of the day, the Baltimore real estate market is always dependent on supply and demand. We expect to see more movement as rates progressively lower throughout the year, but we are predicting to see some major progress once we turn the corner into 2024.
If you have questions about the market or just want to chat real estate, our team is always here to assist you with your housing needs. Whether you’re hoping to beat the buyer wave or need some guidance on pricing your home, we are here to help!
