Repeat home buyers in 2023 are not facing the same circumstances as buyers in 2022—and refinancing is always an option.
The 2023 housing market may not be great for either buyers or sellers. But for current homeowners hoping to play both roles, it could be the right time.
When entering the housing market, current homeowners have to consider twice the circumstances — they are the seller, trying to get the best price for their current home, and a buyer, trying to purchase their next house at a reasonable price point. In a “balanced” market, with roughly even amounts of buyers and sellers, that’s not an impossible feat. But when the market is heavily tilted to one group or the other, a win-win scenario is less likely.
Still, nearly 3 in 5 current homeowners say current rates are “unprecedented,” according to the Home Buyer Report. In fact, rates on 30-year loans have averaged around 7.75% over the past 50 years. At last check, they’re just over 6.5% — high, but below the historical average, and certainly with precedents. Looking back at 50 years of January mortgage rates and their effect on payments for a home purchased at today’s prices can provide some valuable context.
One way home sellers are at an advantage when compared with first-time buyers is they’ve generally had more of a chance to build their credit history. Qualifying for the lowest rates available requires a history of responsible credit usage and on-time payments, and having paid on a mortgage for several years can document that track record.
This trend is seen in even high-demand markets, such as Austin, Texas. There, January 2020 home values grew 61% to a peak in July 2022, before beginning to fall. However, they’re still 49% higher than January 2020. Thus, owners who found a house they liked better would still be making a considerable profit if they sold today.
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