A Look at What’s to Come in 2023
2023 Arizona Market Forecast
October 29, 2022
Mark Hutchins & Jereme Kleven
My Home Group
8360 E. Raintree Drive, Suite 120
Scottsdale, AZ 85260
When is a good time to be in Real Estate? We hope when consumers ask real estate professionals this question, the answer given is; “it is always a good time to be in Real Estate!”
Many would suggest that this is a difficult statement to make with conviction at this moment, so where do we find a bit of certainty in the current environment?
The way forward toward the 2023 market is to understand where we have been. Let’s recap the journey together. During the first half of 2022, we experienced a sellers market with evidence of an imbalance between supply and demand, moving into a frenzied housing deficit that drove higher sales prices. We entered into the second half, and began to see an inventory increase and a decrease in accepted contracts as the interest rates crept up, giving us a glimpse of a balanced market on the horizon. Closing in on the fourth quarter, we have been presented with the Fed Funds Rate at its highest since 2008, a hike in interest rates, cost of living increases, a drop in housing affordability, declines in sales activity and a drop in consumer confidence; some of which were showcased through price reductions, creative financing and concessions.
Whew, what a ride! As we catch our breath, what does this mean for Real Estate Agents looking to navigate a 2023 market with confidence? It means opportunity! The Valley of the Sun is known to be one of the most desirable places to visit and live. Just around the corner is guaranteed increased traffic via The Super Bowl, The Waste Management Open, Spring Training and the overall migration to our state, with projections to hit 8 million citizens by 2026! Dare we say this balance in the market brings good fortune?
For deliberate buyers and sellers now is the time to be in Real Estate. Yet, this upcoming year is not for the hesitant or weary consumer. Therefore, it is our job as Realtors® to manage client expectations and provide expert representation in an environment that consistently undulates. This equates to going back to the basics. Here is our top 5: 1. Know your craft. 2. Continuously educate yourself and your clients. 3. Develop ancillary partnership relationships. 4. Be accountable. 5. Adopt an abundance mindset. Let’s break this down just a bit.
Know your craft: Timeblock your calendar each week for market analysis and review of the inventory. Join mastermind groups and collaborate with like-minded professionals. Stay in your lane; lean on other area experts for guidance where you are not familiar.
Continuously Educate: The current market space we are in is a perfect example and opportunity to connect yourself and your clients with expert educational resources. What is one of the biggest current unknowns? Interest rates; you need to know what they are! Work with your trusted lender partner to speak to your clients about their options, preparedness and all the new lending tools available to them.
Ancillary Partners: You are not alone, tap into all the resources you didn’t even know you had. Title Companies, Lenders, Inspectors, Home Warranty Companies and the like. All these industry experts have a bounty of support and resources for you; create a team of professionals that hold each other to high standards.
Accountability: You are a business owner, do you manage your real estate career like a business? You should! Have regular board meetings with yourself; take inventory of your goals – review your performance – analyze your expenses – assess your marketing – invest in yourself.
Abundance Mindset: Generate new opportunities for growth & success through collaboration. Be humble & empathic while keeping a clear, concise business mindset. Lean into any chaos with intention and curiosity. Surround yourself with people who challenge you and acknowledge those that help you thrive.
Without that crystal ball we are all seeking, we would be remiss in telling you exactly where we will be next year. We can however remind you of what you already know, which often gets lost during a market filled with perplexities ~ there will always be people buying and selling homes, as well as people investing and building wealth through real estate. Question is, will you be willing to commit the time, effort and discipline to be an exceptional real estate advisor?