As anyone working in the real estate industry knows, the market is in constant flux. So with each new year, we also have to anticipate new highs and lows that may impact our real estate strategies.
The same goes for wholesaling properties. For better or for worse, market shifts may impact your ability to find attractive housing deals and broker fast property purchases. That’s why it’s critical to stay on top of housing market trends and adapt your methods to maintain a competitive edge.
As always, things are going to change in 2023. But how will this affect your real estate wholesaling business? We’re looking at the biggest housing market predictions for 2023, so you can set your wholesaling strategies up for success.
Predictions for the 2023 Housing Market
1. Mortgage Interest Rates Will Rise
Inflation hit the housing market hard in 2022, and experts predict that we’ll continue to feel the ramifications of swelling interest rates through 2023. Mortgage interest rates practically doubled in 2022 as the Federal Reserve tried to curb inflation, making it exponentially more expensive for buyers to finance new home purchases. In fact, some experts are estimating that the interest rate for a 15-year mortgage will average at a high 8.25% in 2023, while the rate for a 30-year mortgage will be even steeper at 8.75%.
What does this mean for your real estate wholesaling business? First and foremost, it means that you don’t want to carry the cost of any property for long. So if your usual business model includes buying a property outright before selling it on, you may want to consider a more strict wholesaling strategy of taking on the sale contract only. In this scenario, you don’t own the property, and won’t be on the hook for any interest while searching for the right end-buyer.
Similarly, if you were interested in trying out house flipping as a new revenue channel in your wholesaling business, 2023 may not be the year to start. The longer you spend renovating a property, the longer you’re stuck paying interest and other property fees in the midst of a tight housing market.
2. Housing Inventory Will Fall
As the real estate industry tries to recover from soaring prices, expect property availability to become scarce. Some homeowners may not want to risk moving during a period of economic hardship, and many developers may put the building of new properties on hold. Considering that the housing inventory is already low, this could spell a lot of competition for wholesalers in 2023.
When there are fewer properties available, chances are high that each seller will be approached by multiple wholesalers or developers – especially if they’re offering their home at an attractive price point. So to win bids and keep your real estate wholesaling business on top, you’ll need to think carefully about profit margins and perks for sellers.
With less inventory on the market, it’s also extremely important that you’re reaching out to as many qualified leads as possible. Of course, this can be very time-consuming, especially if you’re busy trying to find buyers and work out the details of each successful deal. With so much market competition, why not get a leg up on lead generation by employing the expertise of dedicated real estate cold callers? Teams like the experts at Call Motivated Sellers can put your staff in touch with both sellers and buyers who are ready to commit, setting you up to close more deals – even in a challenging market.
3. Property Sales Will Decline
Thanks once again to those climbing interest rates, we can expect property sales to slow down in 2023. Many buyers will balk at taking on such high investments in the current economy. This means that even great opportunities may sit on the market for days or weeks. For wholesalers, this means two things: that it will be more crucial than ever to pick properties wisely, and that finding motivated buyers will be essential.
During this time, be sure to keep in close contact with your existing network of buyers. Find out what their goals are for the year, and what they may be looking for in your area. And don’t overlook the importance of courting new buyers through avenues like social media outreach, real estate forums, and cold calling.
4. Home Values Will Plateau
On the upside, it looks like home values will even out in 2023, and may even start to fall as demand dries up. This could be good news for real estate wholesalers, as properties will start to come available at lower prices.
How much housing values will decline remains to be seen, but some experts are predicting that prices could drop up to 10% in some areas, meaning big discounts for wholesalers and buyers who are ready to jump on these deals.
5. The Market Will Be Fairly Balanced
With all this in mind, are we heading into a buyer’s market or a seller’s market in 2023? All in all, it looks like it could be a fairly even balance, with neither side having a distinct advantage. Of course, this will naturally vary from place to place, and some sellers may be able to work the market conditions to their advantage if they play their cards right. As sales slow and sellers watch their properties languish on the market, they may be more willing to accept low offers instead of waiting for something higher. So wholesalers with enough capacity should consider bidding low and often to capture enviable real estate steals.
Make the Most 2023 with Call Motivated Sellers
Ready to start 2023 off on the right foot by building your network, acquiring property contracts, and turning a profit despite a slowdown in the housing market? Enlist the assistance of Call Motivated Sellers.
Our team of professional cold callers saves you time and effort by vetting leads for your team. Informing interested buyers and sellers about the benefits of your wholesaling services, we’ll use our expertise to warm up leads, find the best prospects, and set your sales team up for success. With cold callers on your side, you can leave the hard work of lead generation to us and focus on other aspects of your business.
Call Motivated Sellers is an American-based real estate cold calling service that can help raise your sales and provide hot leads year-round. We have years of experience cold calling in the real estate industry and access to the best information for buyers, sellers, and agents to help you close more deals.
If you’re ready to leverage the power of cold calling for wholesaling, Call Motivated Sellers is here to help. To learn more about the services we offer, just contact our team today!