COLUMBUS, Ohio (WCMH) — Home prices in central Ohio will increase while the number of home sales will decrease in 2023, according to a new report.
Columbus home prices will climb 5% while nationwide prices will increase 5.4% next year, according to Realtor.com’s 2023 Housing Forecast. In addition, home sales are expected to decline nationwide to the lowest level since 2012 at 14.1%, while home sales in Columbus are projected to grow 4.6% next year. Rental prices are also expected to increase 6.3% year-over-year.
Still, chief economist for Realtor.com Danielle Hale said 2023 will be a slower-paced housing market, meaning drastic shifts like price declines may not happen as quickly as anticipated. Next year will be critical in setting the stage for home sales to return to a sustainable pace, Hale said.
“With mortgage rates continuing to climb as the Fed navigates the economy to a soft-ish landing, higher costs will lead to fewer closings, but that doesn’t mean home buying will stop entirely in 2023,” Hale said.
Realtor.com’s report is also projecting a “second wind” in buying activity in the second half of the year. Mortgage rate hikes are expected to continue through March, leading the spring to have less movement than a typical year.
“This break could provide space for demand to renew as mortgage rates dip later in the year, when home shoppers will also have more options and bargaining power,” the report said.
The report also noted incomes are projected to grow by 3.9% next year. However, the growth is not enough to offset higher mortgage rates at 7.4% and the increase in home prices. The shifts create a “trifecta of budget barriers,” especially for first-time homebuyers.
Realtor.com ranked Columbus the fifth hottest housing market in the U.S. for the second consecutive month in October. The Columbus market is also ranked among the top 10 U.S. cities where homes sell the fastest.
View Realtor.com’s full 2023 Housing Forecast here.