As the demand from first-time buyers decreases, bidding wars across the Texas housing market will become less frequent. The latest Case-Shiller home price index report showed a 2% decrease in prices from July to August of this year. Despite the recent recession, economic forecasters are still expecting strong demand from buyers, particularly millennials, and a high rise in home prices in the housing market. Although house prices stayed stable compared to the previous quarter, they still remained above the levels of a year ago.
Most experts in the real estate industry anticipate lower demand from buyers, lower prices and higher borrowing rates. There is an excessive demand for homes in several housing markets, and there simply aren't enough homes to meet the needs of prospective buyers. Only one market in Texas (Pecos) is expected to experience year-on-year home price growth of 10% or more. Towards the end of 2001, the supply levels of the housing market in the Dallas metropolitan area dropped to unprecedented levels. If home prices do fall, some buyers will start to appear, especially those who buy with cash or with a lower loan-to-value ratio, who are less affected by any interest rate issues, explains Scott Krinsky, partner in the Residential Banking Department of Romer Debbas, a Manhattan real estate law firm.
Many people have been excluded from the housing market due to the increase in rents and mortgage rates, which have gone from an average of 3.2% at the beginning of the year to 5.81% in mid-June. With active homebuyers and supply still tight, it is unlikely that current home price trends will be reversed. Davis said that with population growth comes a growing demand for all types of housing in Bryan-College Station. In case a recession occurs, the housing market forecast is reduced to a 20% drop from peak to minimum. Even in recent months, when home prices began to cool down in most markets, foreclosure rates have not yet reached pre-pandemic levels. The future of house prices in Texas is uncertain as we approach 2023. With economic forecasters expecting strong demand from buyers and high rises in home prices, it is difficult to predict whether or not house prices will drop.
However, experts in the real estate industry anticipate lower demand from buyers and higher borrowing rates which could lead to a decrease in house prices. Additionally, if a recession were to occur, it is estimated that there would be a 20% drop from peak to minimum. It is important for potential buyers to be aware of these potential changes so they can make informed decisions when purchasing a home. Those who buy with cash or with a lower loan-to-value ratio may be less affected by any interest rate issues and may be able to take advantage of any potential drops in house prices.
It is also important for potential buyers to consider population growth and its effect on demand for all types of housing when making their decision. Overall, it is difficult to predict whether or not house prices will drop in Texas by 2023 but it is important for potential buyers to be aware of potential changes so they can make informed decisions when purchasing a home.
