House prices in 2023: how will it affect me?

by time news

The rise in interest rates will reduce apartment sales but will increase the pressure on rentals

In the real estate market, 2023 begins with rising interest rates and the tightening of conditions to obtain mortgage loans, a scenario that suggests that this year many households will postpone the decision to buy a home and opt for rent. A decision that, according to OCU experts, will have two direct consequences: the drop in sales prices and the increase in rental prices.

“Although the latest inflation data reveal greater containment, the fight against lasting inflation suggests new increases in official rates by central banks. Wages for their part continue to be unknown, and also the effects of large economic figures, which will foreseeably be felt in different aspects, such as employment or housing prices. As of today, everything seems to indicate that there has been a change in trend in the housing market and it is possible that, despite the many uncertainties in the economy, the price will drop in 2023”, they advance from the OCU.

«The liquidity cushion of families has been reduced due to the high prices of basic products and supplies such as food and energy. To alleviate inflation, loans become more expensive, which increases the debt capacity necessary to buy a home and discourages long-term leverage,” agrees Ferran Font, director of Estudios de pisos.com, who, however, does not believe that there will be a significant drop in prices.

With a view to 2023, “a deep setback is unlikely because housing has just touched bottom after the 2008 collapse. It is obvious that there are micromarkets where the counterweights are not calibrated, but the distance from the maximum allows us to speak of a market quite proportionate. That is why a fork for 2023 of a minimum of -1% is being considered if inflation takes time to come under control and a maximum of 3% if the scenario improves from spring on. The traditionally dynamic markets will remain stable and show reasonable upturns, but in areas with less traction the adjustments will not be long in coming”, he argues.

Font also foresees that “the shift in financing will revive old formulas to which the sector always returns in difficult times, such as renting with the option to buy and the assignment in use for the lawsuit and the bare ownership and the reverse mortgage for the offer”.

On the other hand, it is foreseeable that the increase in the cost of mortgages and the consequent change in the plans of many families will increase the pressure on rents, ”they warn from the OCU, a market in which the increase in demand and the limited supply will come together. offer, since “there are few houses for rent, and many owners are not encouraged by the fear of non-payments”

You may also like

Leave a Comment