The S&P Case-Shiller home price index showed that home prices nationwide dropped between August and September. A month-over-month decline has been unheard of for the past two years. The ability to work from home and low mortgage rates allowed people to buy new homes. Historically low mortgage rates made homes more “affordable” due to smaller monthly mortgage payments. Next year appears to be a difficult one for home prices. Mortgage rates have doubled. The economy is in trouble. However, home prices are still forecast to rise in several cities. These are led by Worcester, Mass., where prices are expected to increase 10.6% next year. That will be the highest of America’s 100 largest cities.
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Realtor.com’s recent Housing Market Forecast report (subtitled “Homebuying Costs Aren’t Coming Down”) indicated that while the increase in home prices will slow, the momentum is still upward, due in part to low inventory. The report noted, “[W]e anticipate fewer home sales and fewer moves in 2023. Sales will be down not only from 2021’s elevated level, but also may be the lowest in a decade as still high home prices and mortgage rates keep the cost of purchasing high.”
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Out of the 100 largest markets, only three are forecast to post home costs higher by double-digit percentages. Besides Worchester’s 10.6%, they are Portland, Maine, at 10.3%, and Grand Rapids, Mich., at 10.0%. Notably, each is a small market with relatively low prices.
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Some large cities that have had influxes in population have home prices that will rise the least in 2023. This includes Dallas, where home prices will rise only 2.2%, as well as Miami (3.4%) and Phoenix (2.6%).
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Americans will not be able to dodge higher home prices next year but, in several markets, they will barely rise.
The City Where Home Prices Will Surge in 2023
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Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.
McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.
His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.
A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.
TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.
McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.
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