What Experts Predict Will Happen to Home Prices in the Coming year?
Experts are starting to forecast home prices in 2023. As they do so, most experts agree that home values in Coachella Valley will continue to rise, just at a slower pace. Home prices have risen at an unsustainable rate in past years, leaving many to wonder how long this will continue. If you are curious about what the future price of your home will be, know that experts are now answering this question. That is good news for homeowners who may have been misled by the media into believing their homes would lose value.
Historically, home prices in Coachella Valley have increased at a rate close to 4%. The average of six major forecasters is 2.5% for 2023. While Zelman & Associates is calling for depreciation, the other five are calling for appreciation. The graph below explains each expert forecast, indicating where they assume home prices will go in the coming year.
To understand why experts are calling for appreciation in the coming year, look to supply and demand economics. According to Dave Ramsey, Financial Expert:
“The root issue of what drives house prices almost always is supply and demand . . .”
Two factors are raising home prices. First, the undersupply of homes is still a problem in Coachella Valley, Indio, Palm Springs, Palm Desert, Thermal, Salton City, etc. There are still not enough homes on the market for the number of people who want to buy them. To add to that, we’re still in a sellers’ market across the country, and in that situation, home prices tend to rise.
Second, millennials are nearing the end of their prime home-buying years. Because they are the second largest population after the baby boomers, demand isn’t going away anytime soon.
Experts predict that home prices will rise next year, although at a slower rate than in the past three years. The reason for this is simple. Real estate is experiencing supply and demand dynamics that will continue for many years.