The housing market is an ever-evolving and dynamic sector that affects the economy and the lives of people worldwide. As we move through 2023, the latest housing market news is of utmost importance to individuals and businesses alike. Whether you are a homebuyer, seller, investor, or simply interested in real estate trends, staying up-to-date with the latest developments can help you make informed decisions. In this post, we will explore the current state of the housing market and the latest news that could impact its future. Read on to learn about the key trends, challenges, and opportunities in the housing market in 2023.

Latest Housing Market News in 2023

• Silicon Valley Bank (SVB) was shut down by the FDIC due to the forced sale of investments and heavy demand for withdrawals, leaving primarily tech companies at risk of being unable to meet financial obligations.
• The Federal Reserve and U.S. Treasury Department have guaranteed all deposits of SVB customers.
• According to Zillow Chief Economist Skylar Olsen, the economic risk caused by SVB's missteps could bring a short-term boost to the housing market by lowering mortgage rates.
• Falling mortgage rates could thaw a frozen spring home shopping season, but SVB's troubles could indicate wider economic issues and lead to a deeper and longer-lasting recession.
• Housing markets in the San Francisco Bay Area and Seattle, where tech employment and stock prices have an outsized effect, may experience a chill and come down in prices due to a widespread tech downturn.
• Lower rates could help home buyers who are stretched thin in affordability, but they should still expect rate volatility and plan on putting down roots for a few years to build equity.
• Lower rates could encourage sellers to move forward and provide more homes for the next generation of buyers.
• New home construction in the US rose by 9.8% in February, to 1.45 million, following a decline in January.
• Apartment buildings were the key driver of the increase, rising by 24.1% in February.
• The construction pace of single-family homes rose 1.1% in February, with single-family construction in the West leading the jump with a 28.5% increase.
• Building permits for new homes surged 13.8% to 1.52 million in February, with permits for single-family homes rising 7.6%.
• Housing starts are still down year-over-year, falling by 18.4% from the previous year.
• Analysts suggest that the recent housing market recovery could have a negative impact on the Federal Reserve's efforts to keep home price increases in check, contributing to lower inflation.
• Despite some optimism among builders, mixed signals from the economy and the housing market, as well as volatile mortgage rates, continue to impact the market.
• Analysts at Jefferies warn that the strength of the housing market in February is probably an idiosyncratic one-off.
• Mortgage purchase applications increased by 7% for the week ending March 10 compared to the previous week.
• Despite the rise in mortgage purchase applications, they are still down by 38% year-over-year.
• The average monthly mortgage payment for home buyers is still hovering near all-time highs at $2,556, up by 24% compared to one year ago.
• The spike in buying activity was due to a small decline in mortgage rates.
• Buyers have been waiting for the right time to enter the market, indicating a potential for increased market activity in the future.
• However, housing market activity is still at a relative standstill compared to last year.
• Redfin's economics research lead Chen Zhao mentioned that buyers have been taking advantage of the current volatile mortgage rates.
• Mortgage rates experienced significant swings this week, falling overall due to bank stress and policy uncertainty, according to Realtor.com.
• The collapse of Silicon Valley Bank and New York's Signature Bank led to a run on regional banks, causing the Federal Reserve to potentially reconsider rate hikes, which could be higher than expected, says Federal Reserve Chair Jerome Powell.
• Stress on the financial system is increasing recession fears, which could cause banks to tighten lending standards, slowing economic activity, and causing investors to flee to safety, according to MarketWatch.
• Heightened uncertainty is disinflationary, causing economic actors to pull back on spending, investing, and reducing inflation rates, including mortgage rates, which are declining.
• The Fed must balance its goals for price stability with limiting financial stability risks, as recent data on consumer and producer prices suggest disinflation is still happening, as reported by Realtor.com.
• The Federal Open Market Committee (FOMC) meeting next week will likely increase mortgage rate volatility, according to sources.
• According to the Consumer Price Index (CPI), consumer prices rose by 0.4% in February after a 0.5% increase in January.
• The CPI's core increased by 0.5% month-over-month in February, while consumer prices were 6% higher compared to last year, but the pace of price increases slowed in February.
• Shelter costs accounted for 70% of the February price gains.
• Zillow Senior Economist Orphe Divounguy stated that the shelter component of the CPI led the price gains in February, accounting for more than two-thirds of the increase.
• Heightened uncertainty is disinflationary as it causes economic actors to pull back on spending, and investing, and flee to safety.
• Mortgage rates are declining and are now almost 50 bps lower than they were just a week ago.
• When mortgage rates fell in January, housing sales ticked up slightly above normal for that time of the year.
• Homebuyers are stretched thin when it comes to affordability, and even a small improvement in mortgage rates could support housing market activity this spring.

The latest housing market news suggests a mix of positive and negative developments. The collapse of Silicon Valley Bank (SVB) and New York's Signature Bank has led to a run on regional banks, causing recession fears, but the Federal Reserve and U.S. Treasury Department have guaranteed all deposits of SVB customers. The economic risk caused by SVB's missteps could bring a short-term boost to the housing market by lowering mortgage rates, which could thaw a frozen spring home shopping season.

Additionally, new home construction in the US rose in February, and building permits for new homes surged, although analysts suggest the recent housing market recovery could have a negative impact on the Federal Reserve's efforts to keep home price increases in check. Finally, mortgage rates are declining and are now almost 50 bps lower than they were just a week ago, which could support housing market activity this spring, although buyers are still stretched thin when it comes to affordability.

Stay tuned for more updates on the housing market as we continue to monitor the situation. If you're looking for real estate investment avenues in 2023, get in touch with us for expert advice and guidance. Our team of professionals can help you navigate the changing market and find the right opportunities for your needs. Don't wait, contact us today to learn more!

Sources:

• https://www.zillow.com/research/silicon-valley-bank-housing-market-32280/
• https://www.zillow.com/research/mortgage-rates-18722/
• https://nypost.com/2023/03/17/how-turmoil-at-us-banks-is-impacting-the-housing-market/
• https://www.zillow.com/research/february_cpi_inflation_2023-32272/
• https://www.realtor.com/news/real-estate-news/u-s-housing-starts-rise-by-9-8-in-february-led-by-a-surge-in-apartment-construction/