2022 was another busy year for the Jarrod Peterson Real Estate Group of Edina Realty. Jarrod Peterson, Lynn Chheang, Jonathan Brenny, and their support staff, sold enough property to rank them in the top .5% of the nation (out of 1.6 million licensed realtors) for the 13th year in a row. It was a challenging year that saw interest rates rise, buyer momentum shift, lower-than-planned inventory levels, and continued slow construction builds. Of course, rent rates rose too and the largest pool of buyers continues to be strong in the marketplace – the millennials. The Jarrod Peterson Real Estate team was able to not only work with so many new clients, but also help repeat clients. We thank you all for an outstanding 2022. Continue reading our blog to learn more about the housing market predictions for 2023.
What will 2023 Bring? More of a Normalized Market:
So, what will 2023 bring? Experts like the Jarrod Peterson Real Estate Group and other national professionals expect a more normalized and balanced market, returning to what was happening pre-pandemic.
1. The spring real estate market will begin in February: For over 16 years in business, our team has led the industry in predicting the kickoff to the very busy spring market. This year, that special kickoff date is February 19th. The spring parade of homes will follow a few short weeks later this year, starting March 4th. If you want to see the spring real estate market trends from the past five years, you can reference the most recent annual report, available FREE on our website.
Jonathan Brenny, a real estate consultant for the Jarrod Peterson Real Estate Group, says “We are already busy meeting with many sellers who are ready to take advantage of the early spring market. At these meetings, we really deliver on our promise by listening to the needs of the seller and informing them of their many options for timing, staging, home preparation, and getting the most money out of their sale.”
Recommendation: Meet with a member of the Jarrod Peterson Real Estate Group now to prepare and take advantage of the spring market.
2. It will continue to be a Seller’s Market: Sellers will continue to benefit from the low inventory on the market. However, it will not be what it was like over the past two years with COVID-19 home buying levels. Low inventory will continue and buyers who understand the process know this means homes will go fast, so they need to bid quickly and aggressively. Sellers who have hot homes in hot neighborhoods can still expect multiple offers if their home is conditioned well and market priced. Lynn Chheang, a consultant on the Jarrod Peterson Real Estate Group predicts we will see more multiple offers this year. “The winter season continued with multiple offers, and the spring and summer markets in 2023 will have them as well.”
Recommendation: Work with an expert listing agent who prices and presents your home to gain multiple offers.
3. Luxury real estate market: In 2022, homes on the local luxury market sold nearly at the same pace as lower-priced homes. That was something new in 2022 and as we head into 2023, luxury homeowners are in a great position to sell. You can request a copy of our luxury market report, here.
Recommendation: Work with realtors who have the CLHMS (Certified Luxury Home Marketing Specialist) designation. They have more resources, tools, and are better prepared to help you get a higher price for your luxury property.
4. Outer ring suburbs will offer the most value: Across the nation, as home prices rose dramatically, buyers were able to get more home for their money in farther remote locations, away from urban cities. Locally, you can continue to see popularity in the outer-ring suburbs like Eden Prairie, Woodbury, and Maple Grove, where the Jarrod Peterson Real Estate Group has been named Favorite Realtor fifteen times by consumers and various media publications. In addition, for more pricing affordability, you will see further buyer reach to areas such as Hudson, Wisconsin, Waconia, North Branch, Jordan and Monticello, and Otsego.
Recommendation to home buyers: Consider further outlying metro areas for housing affordability and more choices.
5. Mortgage rates will remain constant: In 2022, mortgage rates were volatile, and we saw them rise as high as 7.2%. While that is historically a normal mortgage interest rate, it put many buyers into shock and softened their home-buying desires. HousingWire recently cited the following: “The red-hot housing market of the past 2 ½ years was characterized by sub-three percent mortgage rates, fast-paced bidding wars, and record-low inventory. But more recently, market conditions have done an about-face…now is the opportunity for everyone to become re-educated about what a ‘typical’ housing market looks like.”
Recommendation: Buyers should get preapproved as quickly as they can and discuss their financing options with a trusted mortgage lender. Jarrod and his team work with leading mortgage lenders. Access the list, here.
6. Prices will continue to rise: The supply and demand equation is driving prices and will continue to do so. First-time homebuyers will need to ensure they are qualified and ready to compete for the entry-level price. Young millennials will continue to be a huge buying pool, and in 2022 made up 32% of all purchases (National Association of Realtors). Sharry Schmid, president of Edina Realty, cited that the average age of the first-time home buyer is now 36 years of age.
Recommendation: Don’t wait. Homes will continue to appreciate, and you will most likely pay more for that same home a year later.
7. Rent rates will continue to rise: The rental market is showing no signs of slowing down. Look around, you can see apartment homes being built in every major city. In fact, multi-unit housing is accounting for approximately 34% of all commercial projects nationally in 2022, according to Todd Richardson, General Deputy for Housing and Urban Development. It is fueled by housing demand and there is no slowdown in sight for the next few years. As a result, rent rates are at an all-time high across the nation.
Recommendation: Meet with a qualified loan officer who can show you how much money you can save by owning a home rather than renting.
Not every real estate team could predict housing market trends, like the Jarrod Peterson Real Estate Group. Our combined 37 years’ experience in the market affords us rich experience that you can benefit from. To learn more about these trends and others the team is forecasting, contact us for a private consultation.
So, what are your next steps?
To ensure you are ready for the fast-moving market that begins February 19, you will want to schedule a private and confidential conversation with a professional, accredited, and award-winning realtor as soon as possible. The spring market only lasts so long, and if you want to leverage it, we are here to help. Contact our team to get the ball rolling!