The United States real estate market has been functioning at a high recently, resulting in all-time lows concerning inventory levels; as prices continue to soar in the face of demand, supply is inevitably shrinking. While this certainly makes for a happy seller, it’s caused continued disruptions to buyer satisfaction, becoming increasingly harder to find and close on a suitable property at a reasonable price. Contrastingly, much like the rest of the world, the United States real estate market has suffered tremendously in the wake of the COVID-19 pandemic.


From lay-offs and record unemployment rates to shifts in priority and perspective, there was no telling when housing would return to normal; in fact, it may never return to “normal”, which brings into question what the new normal of selling a home is in today’s post-pandemic world… While there are several reasons for the rollercoaster that has been the American real estate market, the question remains, will the United States real estate market ever return to a pre-pandemic state, that which is considered “normal”, or are we to move forth in what is now being referred to as the “new normal”?…


What to Expect in 2023


Transitioning from 2022 into 2023, the landscape is set to remain much the same when it comes to selling real estate. With interest rates persisting to remain low, mortgage rates continuing to be affordable for potential buyers, individuals further capitalizing on the ability to save money throughout the pandemic, and many returning to their jobs, there’s no reason why the United States real estate market can’t continue to succeed in the face of adversity.


Further, the demand is still there because, well, the inventory supply continues to remain low; an unfortunate and oftentimes frustrating situation for homebuyers, however, a great problem to have as a seller. Not to mention, the rate at which homes are being built in 2023 is ramping up. With that said, these persistently low inventory rates may have a carry-over effect on the cooling-off of the market in 2023, even when you take into consideration the rate of home building…Nevertheless, for the reasons outlined above, it’s all but inevitable that sales will continue to remain strong throughout the year.


The Forecasted Real Estate Cool-Off


Despite the forecasted real estate cool-off, it’s still strongly assumed that sales will continue to remain strong, as mentioned above. It’s been forecasted as well that the average U.S. home price will rise nearly 15% year-over-year into 2023; congrats sellers. Your wish of continuing to sell at higher prices will likely come true in the foreseeable future… With that said, a cool-off IS expected before the new normal persists to grow. What does this cool-off look like, you ask?


Due in part to low inventory rates and higher construction costs, in part because of the remnants of the impacts of the pandemic, and in part because of the rising housing prices demand is likely to dip at some point in 2023. Second, because of the persistent demand from homebuyers and the level of competition concerning bidding wars, prices are going to continue to increase in the face of low inventory rates. In short, while an adjustment period will likely be required by buyers and sellers alike, it’s unlikely to last long.


The New Normal


Withstanding all of the turbulence that the world has undergone in the last couple of years, much of it impacting the real estate market at large, there still shouldn’t be any worry or hesitation on behalf of either buyers or sellers. While we’re certainly due for higher mortgage rates that will ultimately cause the aforementioned cooling of the seller’s market (i.e. home prices) at potentially unprecedented levels in the short term, we believe that the new normal will be one that will benefit both the buyer and seller in its ways.


To conclude, contrary to the pessimistic economist perspective regarding the future of the American seller’s market, we believe that the new normal of selling a home will continue to be one of prosperity and growth. Expect dips and periods of drought, yes, however, prepare for the future, for it’s a bright one.