Did you know that the average price of a home in the United States was over $428,000 in 2022? That was about a $100,000 increase compared to the previous year.
With home prices so high in 2022, people looking at their local market may be wondering if that is going to continue. Well, for those of you that are in the Pittsburgh area, here is a 2023 forecast on the Pittsburgh property market.
Rising Mortgage Rates
The first thing that you need to understand about the real estate market is that when it comes to affording a house, what kind of mortgage rate you can get can be crucial.
An example is if someone is paying a 3% mortgage rate on a house compared to 6%. Well, the former buyer can save half of the money on the interest payments then. If you do this for 15-30 years, we could be talking about hundreds of thousands of dollars.
These rates increased to that extent throughout the country in 2022. Because of this, it has made more buyers question if they can afford to buy a house that is listed at a certain price.
Less Demand
In 2022, Pittsburgh saw the average days on the market for a house increase compared to earlier in the year and in 2021.
In October 2022, the average was 54 days. That was three days higher than the previous month and four days higher than the same month in 2021.
What this means is that people are not in as much of a rush to buy a home as they were in the recent past. Part of this could be due to the rising mortgage rates making people hesitant to go through with home purchases.
Essentially, buyers are being a little more cautious than before, causing houses in Pittsburgh to sit on the market a little longer.
Lower Median Listing Price
The above has also caused sellers to react to this. Since they are discovering that buyers may not be able to afford the past year's prices like they used to, sellers are now listing their homes at a lower price.
In October 2022, this price was just under $220,000.
How does that compare to previous months and previous years? Well, compared to the prior month and the same point in the prior year, it is down 2.27%.
Sellers have faced the reality that the average buyer is not willing to spend what they did in the past.
Follow the Pittsburgh Property Market
So, what should you take away from this Pittsburgh property market forecast? Well, the main thing should be realizing how important mortgage rates are for buyers.
Because these rose so drastically in the second half of 2022, it has caused real estate in Pittsburgh to sit on the market longer and it has caused sellers to lower their listing prices.
As an investor, this could mean that 2023 is friendlier to buy in than it was last year.
Are you considering investing in real estate? Message us to learn how we can help manage that property once you do.
