When 2023 began, expectations for the national housing market were cooling sales while housing prices continued to climb, reaching double-digit gains by year-end, reported Realtor.com®. Now mid-way through 2023, Realtor.com is revising its national forecast.
Keep in mind, though, Boulder’s housing market — both city and county — is not tracking with the rest of the country.
Realtor.com reports an expected slight decline for the year of home prices and mortgage rates nationwide. The forecast is for housing prices to dip 0.6% in 2023 compared with 2022 and for mortgage interest rates to decrease to 6.1% by year’s end.
Most home buyers “won’t see much — if any — relief. There won’t be any big price drops reminiscent of the Great Recession,” writes Realtor.com. The expectation is that nationwide home costs will be higher for buyers in 2023 since price declines are mild and mortgage rates remain high.
But even a slight decrease is a relief from years of double-digit price growth. Last year alone, national home prices rose 10.2% year over year.
The local real estate picture looks different than the nation’s, a local phenomenon is seen repeatedly. The median listing price in the city of Boulder rose nearly 25% in May 2023 to $1.5 million, compared to the previous year, according to housing data in Realtor.com. The city is still rated as a seller’s market, with more people searching for homes to buy than inventory available, and homes sold for approximately the asking price with a 100% sales-to-list price ratio. The median listing home price per square foot was $606 and the median home sold price was $875,000, with a median of 33 days on the market.
In Boulder County, the median listing home price of $899,000 was up 5.8% year-over-year in May 2023. Per square foot, the median listing price was $407 and the median home sold price was $735,000. Homes sold on average for about the asking price in May 2023 with a 100% sale-to-list price ratio. Boulder County is considered a balanced market, with equal supply and demand for homes. Homes spend a median of 32 days on the market.
High mortgage rates are impacting housing inventory, with ‘mortgage rate lock-in’ playing a stronger role than expected. Realtor.com expects home sales to decline 15.8% in 2023 for about 4.2 million sales for the year — the smallest annual total since 2012 — and for inventory levels to slip 5%.
“The vast majority of homeowners locked in low rates during the pandemic and aren’t particularly excited to give them up to buy a new home, unless they need to move for personal reasons,” said Hale.
By Tom Kalinski. Tom is the broker/owner of RE/MAX of Boulder. He has a 40-year background in commercial and residential real estate. For questions, email Tom at [email protected], call 303.441.5620 or visit boulderco.com.