As we enter a new year of real estate investing, we are getting mixed signals. If you are reading the latest from the media, real estate predictions for 2023 change from one minute to the next. One day, a recession is headed our way. The next, we have already had a recession, and the very next day, we are headed for a soft landing or a steep crash. So what will happen?
The honest answer is that people are still determining what the future holds. Interest rates and unemployment will dictate what happens in the coming year.
If rates continue to rise and businesses continue to lay people off, rest assured, we are headed for down times. If, on the other hand, we see modest rate hikes and job losses, we should continue to see a steady real estate market.
Danielle Hale, Realtor.com chief economist, expects home sales to be dramatically lower, down 14.1% compared to 2022, as both buyers and sellers pull back from a housing market and economy in transition. However, she also expects the annual tally for 2023 to be roughly in line with the current pace of home sales in late 2022.
Another real estate prediction for 2023 that could be good news for those who have rental properties, according to Forbes, the median rental is projected to increase by 6.3% in price, even as an influx of new multifamily housing helps to meet rental demand better. As a result, renters looking to save in the year ahead may consider moving further to the suburbs.
I would prepare for the worst and hope for the best. But, unfortunately, you can’t fight the Fed, and it looks like the Fed will keep raising rates shortly.
With this in mind, I have three strategies for success in 2023.
1. Stay liquid.
A little extra money on hand never hurts. As the markets fluctuate, the people with cash can act quickly and take advantage of opportunities that arise.
2. Quick Turnaround.
If you are flipping or renting properties, sell or refinance them quickly. Time is your enemy now, and you don’t want to get caught without a chair if the music stops.
3. Quality.
Paying top dollar for every property is a trend that has finally ended. You have already seen a flight to quality; good homes continue to sell or rent quickly. The less desirable or junky properties are sitting. So make sure your properties are of high quality with a focus on location, floor plans, and high-quality finishes.
If you follow these few guidelines and watch what rates and unemployment are doing, you’ll have a successful 2023.
As always, if you need cash fast, don’t hesitate to contact me for information on an asset-based loan. We can get you approved in 24 hours and funds within 48 hours.
Visit here to get pre-approved or Call 248.729.1898es