Matt Broyles

All the stats for July are out. The full reports are below. 

The National Association of Realtors released their US Economic Outlook going out to Q2 of 2023. It includes a breakdown of GDP, Mortgage Rates, Housing Indicators, etc. They have a very good track record at forecasting. 

The first thing I noticed was GDP (of course I did, it is on the very first line). It came in at -1.6% in Q1 this year. Which was actually not bad as it would have been hard to top the 5.7% increase from 2021 as inflation exploded. Then, in Q2, GDP it -0.7 (pretty close to even) and by definition placed us in a recession.

If you look at the outlook for GDP in Q3 this year, they are calling for a 2.3% growth and to remain positive from that point.

Does that mean the recession is over?

Well, IF that forecast comes to fruition, technically…yes. However, the hangover will last for another six to eight months as earnings reports and housing numbers always lag. So, as the economy will have recovered GDP-wise, we will be feeling a down market until early to mid-year next year.

What does this mean for the real estate market?

If you dig into the data here and take a close look at the picture NAR paints about the existing home sales from now to Q2 of 2023, you see that they are predicting around a 5% correction that starts in Q4 of this year and extends into Q1 of next year.

In Q2 this year, we hit an all-time high of $406,600 median price. In Q3, they predict a slight decrease to $402,400 (we are already seeing this in most markets but not in Atlanta and North Fulton). Then, in Q4, they predict a 5% drop to the $380,000 range, and for that price to hold through Q1 of 2023. We're still going to be at 11.5% positive appreciation for the year. 

In Q2 of 2023 is where we see fireworks as NAR is calling for median prices to shoot back up around 9% to new all-time highs of $413,000. We also see a transaction boom in that same quarter from a 5M annualized rate in Q1 2023 to 5.2M in Q2. That’s a huge bump in transactions seeing how we not only have to hit the average but also catch the earlier months up as well.

There are no signs in our market today that shows we will see a decrease here in North Fulton. Of course that can change and for the rest of the country this doesn't seem as bad as a lot of people have been forecasting especially since we will quickly rebound to a new all time high.

I am going to watch this very, very closely and will let you know if anything changes. 

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Thinking of buying or selling this year?

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