In this episode, Eric Martel answers the question on many people's minds: will the real estate market crash in 2023? To help answer this question, he looks at 6 key metrics that influence the state of the housing market: inflation, interest rate, unemployment, housing supply/demand, cryptocurrency, and recession fears.
First, Eric discusses inflation, which is expected to decline in 2023 from its current rate of 6.5% to around 3-4%, the normal inflation rate. This decline in inflation is good news as it means prices won't rise as fast, but it doesn't necessarily mean that prices will go down.
Next, he examines the interest rate and how it affects the housing market. With inflation projected to decline further in 2023, the Federal Reserve is expected to keep interest rates low. This is positive for the housing market as lower interest rates make borrowing more affordable for buyers, leading to an increase in demand for housing.
Eric also talks about the current state of unemployment, which is projected to remain low in 2023. Low unemployment means more people will have stable income and job security, which will increase demand for housing. Additionally, with the stabilization of inflation and normalization of mortgage rates, Eric expects a moderate increase in housing supply, which will help keep house prices from rising too fast.
Eric also addresses the impact of cryptocurrency on the real estate market. While a crash in cryptocurrency could have a negative effect on the economy, the overall impact is expected to be small due to the relatively small size of the cryptocurrency market compared to other financial markets.
Finally, Eric concludes that while a recession is a possibility in 2023, the outlook for the housing market is more positive. With low inflation, low interest rates, an increase in housing supply and demand, positive economic growth, and low unemployment, all positive indicators, the real estate market is expected to remain stable in 2023. Eric suggests keeping an eye on these factors and any new developments, but overall, the outlook for the real estate market is positive.
