Content provided by Bellco Home Loans
Originally published February 2023
With January 2023 already in the books, signs are beginning to show that we may be beginning to hit the housing recession trough, according to a recently published paper by Goldman Sachs.
Looking at national data, there has been week-over-week increases in home search activity and application engagement as the year advances, according to chief economist Ali Wolf who advises the White House on housing matters. This is attributed to three main items: seasonality, acceptance, and discounts.
‘Tis the Season
Historically, housing is slowest in the November and December holiday season and then tends to pick up with consumer engagement beginning in the new year. Across the nation, builders and agents have seen an uptick in buyers looking—and traffic is increasing at open houses. Although physical contracts are lagging behind, search activity continues to heat up and it appears that it is only a matter of time as offers are meshed up with search activity.
With 2022 in the rear view mirror, consumers have had some time to mourn the loss of record-setting interest rates and see gradual improvement with rates at their lowest levels in the past 4–6 months. This stability has provided consumers with a bit of optimism now that things have settled down and many analysts are predicting further reductions in rates as the year advances.
Colorado continues to see more than 50% of home sales receiving seller concessions or price reductions in this housing recession. However, the looming question is if inventory remains low and consumers activity is increasing, will we see the evaporation of sellers’ willingness to negotiate? Early indicators have shown homes are selling quicker, even with occasional bidding wars, as the 2023 home buying season kicks off.
Although we are not out of the woods yet, the housing industry is beginning to feel like their recessionary activity could be winding down as other industries are feeling the economic tightening.
The Bellco Home Loans team can assist Bellco members with any real estate questions or concerns they may have as they look to navigate this ever changing market.
Bellco Home Loans is a joint venture between Bellco Credit Union and Cherry Creek Mortgage, an independent mortgage lender that’s been helping families attain homeownership for over 30 years. Bellco Home Loans is an equal housing opportunity lender. All applications subject to approval. Bellco Home Loans, LLC, NMLS #2085298.