Investing in real estate is a risky business – unless you consider all the factors that guarantee success. Evaluating the current market and waiting for the perfect moment to buy a property is one of the essential steps to make sure you’re doing the right thing. Particularly if you’re looking for a property in one of the hottest markets such as California. Whether you’re looking for a new home or an office space, or you’re searching for an investment property, checking what’s going on the market is one of the first things you should do. Predictions and trends are always changing and depend on a number of different local and worldwide factors. So, what can we expect this year? Here are the real estate trends in California in 2023 – take a look and wait for the right moment to take a leap.
What happened in 2023?
The aftermath of the pandemic period has brought several changes to the markets countrywide. The one in California experienced a drop in sales – a continuing trend since 2020. In 2023, house prices have risen significantly, making certain areas such as San Francisco the most expensive market in the country. The reason why there’s less demand is that interest rates are going up all the time, preventing prospective buyers from making a step toward their new home. But what will happen in 2023? Let’s find out.
Some California’s cities remained the most expensive markets in the country.
Real estate trends in California for 2023 – are predictions going to come true?
Each year starts with predicted trends for the following period, based on the previous conditions in the market and the overall financial, geo-political and social situation in that area. Let’s see what trends we can expect in the following year, and see if that’s the best time for you to invest.
Buyers are less likely to invest
With the rise in prices and mortgage rates in the previous couple of years, buyers will be less likely to jump into the real estate market. The pandemic economy is finally coming to an end, yet California will probably experience a decline in home sales. Some reports predict a decline of about 6% in the number of sold properties, even though the economy is starting the recovery period. For sellers, this would mean lower demand and more effort to sell their properties, while buyers will have more homes to choose from – in case they decide to actually go for it.
The shift in popular locations
When the pandemic started, cities were filled with working-class people looking for job opportunities in major California cities. However, the pandemic has brought changes in how things work, and a huge number of people were allowed to work from home. This resulted in many families looking for suburban homes, where they can get more square footage for the same price and work from spacious, more comfortable homes. This trend will probably continue in 2023, when the demand for suburban properties will continue to grow. Big cities such as Los Angeles and San Francisco are experiencing a decrease in sales, due to the high prices but also the fact people are looking for a less busy place to live.
Buyers are looking for homes away from the city center.
High mortgage rates
The trend of rising mortgage rates is hurting both sellers and buyers. With inflation going strong, mortgage rates rose by about 3%. This results in the declining number of mortgage applications, and surely the number of sold properties all over the state. So, if you’re planning on buying a home, be sure to investigate your loan options well, and be sure you’re financially ready to take this step.
Should you sell or buy a new home?
The ever-changing real estate conditions make it hard to decide if it’s a good time to sell or purchase a new property. Most people still want to purchase new homes. However, with all the information we’ve got at the moment, it seems that this is now the seller’s market in California. Low inventory ensures sellers are at an advantage, and rising prices are only helping sellers decide to put their properties on sale.
Do your best to avoid common seller’s mistakes and attract buyers as soon as possible.
Tips for selling a home in California in 2023
Putting up the ‘for sale’ sign in front of your home is only one of the steps towards a successful sale. Here are some tips that will help you attract buyers even though they are not that willing to invest in 2023.
Do the right improvements
You may be willing to invest in your property and renovate it before putting on the market. However, to make sure this pays off, pick projects that bring the most value to your home. These often involve kitchen or bathroom renovation – things that buyers take a look at first.
Solve the issues
If your property has some issues buyers would find problematic, be sure to solve them before putting the home for sale. This will help you avoid problems with home inspection and negotiation, and a significant drop in price.
Do proper staging
You want to spark interest in buyers and make them take a closer look at your property. Staging is one of the best ways to prepare your home for sale and makes a difference with the majority of buyers. Furthermore, use virtual staging and professional photographs to highlight the best features of the property, enticing prospective buyers to come and see the place in person.
Be ready for the transition
Don’t wait until the last minute to find a new home and plan the moving process. Once you decide to sell, start making plans for a smooth and quick transition to your new home. You never know when a serious buyer will come your way, so it’s best to be prepared and have all the details sorted out regarding reliable delivery services, your moving budget, and more. Furthermore, you’ll avoid moving in a hurry, which mostly comes with complications and problems.
There will always be factors that tell you it’s not the right time to buy or sell. However, with careful consideration of real estate trends in California for 2023 and your financial situation, you’ll be able to make the right decision and make this a year of successful investments.