Many people have questions about the current state of the Boca Raton housing market. They want to know how rising interest rates and inflation impact the market climate and the value of their homes. They are curious about the likelihood of a future recession and how significant it could be. Perhaps you are asking some of these questions yourself. If so, you have come to the right place. This article will dig deep into the current state of the housing market while providing a future real estate forecast that helps you make informed decisions about whether to buy or sell in the upcoming year.
1. What’s the local market doing right now?
The current state of the Boca Raton market is somewhat surprising. Home prices dropped earlier in the year but have climbed in recent months. This is shocking because most markets across the nation are currently in a slight recession. Average prices are coming down after rising exponentially in previous years. There are a number of factors in play, but two of the main reasons cited by experts for the market stall are rising interest rates and rampant inflation.
Despite the presence of each of these issues, the Boca Raton market seems to remain in a strong position. Homes are spending more time on the market than in years past, and fewer homes are selling than what past monthly averages would lead you to expect. Most homes spend around one month on the market and sell for a price slightly below listing. Only one in four homes will drop in price during their time on the market, but it’s rare for a home to sell for an amount above the seller’s original asking price. It remains to be seen whether or not the national landscape will impact the Boca Raton market to a greater degree than it already has.
2. How much does the market usually change throughout the year?
In a normal year, the market picks up during late spring and early summer. Sellers tend to command better prices on their homes when they publish their listing during these months. Buyers are more active for several reasons, including the return of tax refunds and the end of the school year. Most people also prefer to move during a time when the weather is more pleasant. It’s not uncommon to see people eager to get out and shop for homes after spending all winter cooped up inside. It’s less of a factor in Boca Raton because of how pleasant the Florida climate is most of the year, but it certainly impacts those who are moving to Boca Raton from other states or communities.
The market usually stays hot through August and begins to trail off in September. By October and November, things are pretty quiet. People are busy with other tasks, such as planning for the holidays or working towards end-of-year goals. Most don’t have the extra margin to shop for a home. Properties will still sell during the fall and winter, but most sellers find that they have to work harder to market their homes to generate significant interest from prospective buyers.
3. What’s the market likely to do in 2023?
Most experts predict a slight recession will take place in the coming year. Nobody seems to think that the market will take a major step back or fully crash as it did in 2008. Home prices will dip slightly, but they should still remain significantly higher than they were just a few short years ago. It’s possible that interest rates will come down in the near future as the Federal Reserve has publicly expressed their desire to lower rates. Don’t expect interest rates to come down until inflation falls to a more manageable number.
4. Should I be worried about my home’s value?
Not necessarily. The current state of the market should have little to no effect on the long-term value of your home. Over the past 100 years, property values have outpaced inflation by nearly three percent. This is important to remember because of major economic events that have taken place during that time period, such as the Great Depression of the 1930s and the housing market crash of 2008. Time and time again, the market has survived major crises and come back stronger than before.
The other reason buyers should have peace of mind about their home’s long-term value is that homes are hard assets. A hard asset is something with visible and tangible value. Because homes have obvious value that is easy to perceive, their worth is less likely to rise and fall drastically in a short time period. You see this happen with soft assets such as stocks - their prices can often change multiple times during a single day. Home values don’t fluctuate anywhere near this much. If a home was ever going to lose a large portion of its value, it would take several years to see a noticeable change.
5. Will 2023 be a good year for buyers or sellers?
While 2023 will present its fair share of unique challenges, it still may be a good time to test the market. Since prices aren’t expected to drop substantially, sellers will remain in a strong position to command a good price on their home. Buyers will benefit from slightly lower prices and the opportunity to lock in a price and begin building equity. They maintain the option to refinance their loan down the road if the opportunity presents itself.
6. Who can help me buy or sell a home in 2023?
Emily Deleon is a trusted real estate professional who has spent years helping people buy and sell homes in Boca Raton. Her knowledge of the local housing market is second to none. She provides this insight to each of her clients so that they are prepared for whatever happens during the process of buying or selling a home. Reach out to Emily if you still have questions about the current state of the market or if you’re ready to take the next step toward buying or selling a home.
