As the curtains draw close on the initial chapters of 2023, Redfin CEO Glenn Kelman, a prominent brokerage giant has expressed concerns about what the rest of 2023 might bring in the real estate market. The predictions reveal that the housing market is at a momentary standstill, making the existing difficulties for home buyers and sellers even more difficult. As the industry navigates through intricate factors, such as rising home prices and restrictive regulations, the road ahead seems to be filled with uncertainties.
During Kelman’s recent appearance on the Fox Business Show “The Claman Countdown,” he stated, “The market is at a standstill.” His remarks mirror the sentiments of the market struggling with a sense of stillness and lack of movement. Sales volume has dropped to unprecedented lows, leading to a strange situation where potential sellers are hesitating to part with their properties because of their mortgages, while potential buyers are unable to afford the inflated prices. This challenging real estate situation, as pointed out by Kelman, has set the tone for what he calls a tough year in 2023.
Providing significant insights, Redfin’s latest report highlights that things are changing in the real estate market. Almost one out of every ten homes in the USA now costs a million dollars or more, which is a big jump. This is happening because there aren’t many homes for sale, causing potential buyers to fight over the limited homes on the market. This competition is making the home prices go over the seven-mark figure, making it harder for typical home buyers to move into more spacious accommodations. The homes that were almost worth a million dollars are now actually worth more than that.
As Kelman claims, the central point of the matter lies in the supply-demand balance. The CEO points out the pressing need to construct more homes in response to the rising demand. However, this plan is hampered by problems with local governments and policies that say “not in my backyard” (NIMBY), which makes building homes slow. In addition to Kelman, the NAHB CEO Jim Tobin comes into light saying, “It’s time for local governments to step up and state governments and federal governments get their red tape out of the way, let us do our jobs and put more supply in the market.” Robert Dietz, the chief economist at NAHB, said that to make the housing costs go down and help more buyers afford homes, new rules must be put in place from different levels of government to let builders construct more homes. This is needed because there’s a shortage of about 1.5 million nationwide.
Despite political plans to make housing more affordable, Kelman says many of these rules and regulations divert builders to build in other places. People in the country are showing their choice by moving. Even if they have different political views, they all still want affordable homes. And currently, the open market is doing a better job of providing that than many of our government rules.
The real estate path for the rest of 2023 will be tough for those in the industry and home buyers. Glenn Kelman’s insights offer details about the complexities of the current housing market and advise the importance of being creative and changing whenever required. In the future, it is essential to know how the market works and the rules guiding both sellers and buyers to achieve what they want.