Market Update for the New Year

It’s a new year, which means it’s time for new home goals, housing market updates, and opportunities for homeowners throughout West Michigan and the Greater Lansing Area. Join Eastbrook Homes as we discuss housing market trends, mortgage interest rates, and expected rental prices. Together we’ll hear insider housing market insight from one of our preferred lenders and explore the best ways to make the most of your housing budget in 2023. 

Housing Market

The last two years brought a whirlwind of unpredictable housing activity to our doorsteps, with widely-fluctuating home prices, record-low interest rates, and a highly-competitive seller’s market. Housing experts agree 2023 will be a year of much-needed relief as the housing market begins to stabilize after close to three years of pandemic-induced inconsistency. 

West Michigan residents can expect to see a slight softening in turnaround time from listing status to sold, although that’s compared to the flurry of above-average metrics from the last two years. Despite a predicted slowdown in national housing market trends, local experts believe West Michigan will continue to see above-average sales due in part to the region’s nationally-ranked popularity and recurring growth. In Realtor.com’s 2023 Top Housing Market report, Grand Rapids came in 7th for Top Housing Market for Growth and 7th on the 100 Largest US Metros list. Time and time again, West Michigan proves to be one of the best places to live in the nation. 

Mortgage Interest Rates

The latest Economic News Release from the US Bureau of Labor Statistics shows a Consumer Price Index inflation rate of 7.1%, which may translate to lower overall inflation compared to previous years. Mortgage interest rates are consequently expected to stabilize and remain consistent through the first half of 2023, holding fast at 6-6.5% depending on loan terms.  

Lake Michigan Credit Union, an Eastbrook Homes Preferred Lender, advises, “Given the potential risk of a slow down  in the coming years, it may be advisable for individuals to consider adjustable rate mortgages for the short term.” Adjustable-rate mortgages typically allow homeowners to start with a lower interest rate than fixed-rate mortgages while also allowing the flexibility to adjust if/when rates drop. 

Rental Prices

Rental prices continue to remain at an all-time high, with most rental costs exceeding those of a traditional home mortgage. Rent is up nearly 20% in most West Michigan counties since 2019; the average cost of a two-bedroom apartment in Grand Rapids is close to $1400 a month. 

Between skyrocketing rental costs and a lack of rental availability for residents nationwide, LMCU predicts 2023 may be the year renting families decide to purchase their own homes. This could mean an even greater demand for housing and consequently, increased housing prices. Owning your own home translates to better equity over time, better housing stability, more control over the home and surrounding property, and better tax incentives. 

“Overall, the potential financial and personal benefits of homeownership make it a compelling option for many individuals,” LMCU advises. “When housing supply is low, building a new home can be a better option than trying to purchase an existing one, as it may be more difficult and expensive to find a suitable home on the market.”

Are you ready to make the most of the 2023 housing market and reach your homeownership goals by partnering with West Michigan’s leading homebuilder? Take the leap into homeownership with Eastbrook Homes by checking out our customizable home plans and building process. Our free, downloadable Interactive Homeownership Guide takes you through every step of the homebuying process, from establishing a budget and choosing a lender to prioritizing home features and selecting the perfect community. Make 2023 the year you reach your homeownership goals by connecting with an Eastbrook Homes Sales Agent today.