In 2023, the US real estate market will enter an era of "balance and division" 🚪
In 2022, the market was hit by high inflation and rising interest rates, ushering in a market dominated by recession expectations. Entering 2023, mortgage rates are expected to hover at a high range of 6%-7%, suppressing high demand, making both buyers and sellers face more cautious consumption judgments
New York Post
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Mortgage Partners
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CBRE
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. The country as a whole presents a "cooling but resilient" state: transaction slowdown, price growth rate decline, but tight supply continues to support valuations
Global Real Estate Guide
Redfin
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This article will focus on analyzing the market outlook of several hot spots, and combine market structure and policy factors to analyze why different cities continue to attract or sink real estate market attention.
1. Macro trends and policy environment: high interest rates take precedence, inventory determines direction
The dual impact of interest rates and consumer confidence
According to CBRE's 2023 outlook, although the economy is expected to enter a mild recession in the second half of the year, the federal funds rate will peak at 5.25%-5.5% and slightly drop to about 4.5%-4.75% at the end of the year, and the 10-year US Treasury bond will also fall back to 4.0%, but high-cost credit will continue to suppress housing demand
Realtor
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Redfin
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CBRE
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CBRE
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. Freddie Mac predicts that national housing prices will continue to rise steadily, with an approximate growth rate of 6.3% (2023), falling to 2.7% by 2024
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The inventory gap is still there, and the dominant price support continues
The supply and demand structure remains the key driver of housing prices in a high interest rate environment. HUD pointed out that inventory continued to be low, supporting housing prices to remain resilient; Redfin data showed that as of June 2025, the number of residential listings nationwide increased by only 7.8% year-on-year, sales increased by 3.8% year-on-year, and the median price was $447,054, an increase of 1% year-on-year
National Association of Home Builders
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Redfin
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Global Real Estate Guide
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2. Regional pattern: "bubble risk" in the south, steady growth in the Midwest and Northeast
⭐ Southern region (Texas, Florida, Georgia, etc.): high growth accompanied by high supply risks
In the post-epidemic era, a large number of immigrants have poured into states such as Texas, Florida, and Tennessee, attracting population inflows and driving a surge in new housing. However, demand has cooled recently, and some experts have warned that these markets have the risk of over-construction, and housing supply has reached a historical high or even exceeded the peak level in 2006, which may trigger the risk of price decline
New York Post
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Despite this, Florida continues to attract international capital, especially British investors, and is still attractive for tax incentives (no state income tax), livable climate and open immigration channels.
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⚖️ Midwest and Northeast (such as Pennsylvania, suburban New York, Milwaukee, Detroit, etc.):
These markets have low inventory, little speculation, and no concerns about bubble accumulation
New York Post
Visual Capitalist
. In the latest statistics from Redfin, cities with obvious growth include Detroit, Rochester, Lafayette, etc., with annual growth rates exceeding 10%, among which Detroit and Rochester, New York, have a year-on-year growth of 23.5%
Redfin
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🌵 Partial differentiation between the Southwest and the gradually warming Sunbelt
According to the PwC report, the Sunbelt region is still the focus of capital and population migration, Dallas/Fort Worth surpasses Phoenix and Nashville to become the leader, and the Florida market is also returning strongly
PwC
. However, we still need to be vigilant about the risk of over-construction in some cities.
III. Analysis of sub-cities: Five cities that buyers "can't miss"
Josh Altman (celebrity agent of "Million Dollar Listings") pointed out that the following cities have become the focus of future growth potential due to factors such as population, employment, and relative affordability: Atlanta, Dallas, Orlando, Phoenix, San Diego
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Atlanta: The population is growing steadily, and the median house price is about $429,990, which is still relatively cost-effective.
Dallas: The population size is about 1.3 million, the median house price is $499,900, and the market is vibrant.
Orlando: Strong support from tourism and service industries, the median house price is $407,440.
Phoenix: The population is close to 1.65 million, the median house price is $461,000, and immigration continues.
San Diego: Although the house price is as high as $980,000, it is still attractive to high-income immigrants
Business Insider
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Although housing costs have risen in these cities, most economies still support medium- and long-term investment logic.
IV. Risk warnings and policy variables: the impact of capital gains tax and holding behavior
Older owners delay selling their homes, exacerbating market supply tensions
Some "empty nest" baby boomers in the United States choose to continue holding high-asset properties due to concerns about capital gains taxes, reducing the flow of family-type housing into the supply market. If relevant tax reduction policies are implemented, it may lead to a surge in resales, but it is also accompanied by the risk of rapid price redirection
Business Insider
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Commercial and multi-family real estate sectors are surging
CBRE's 2023 outlook points out that office assets are under pressure due to high interest rates and post-epidemic remote work, warehousing, logistics and data centers are relatively strong, and retail and hotel industries are expected to recover moderately
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CBRE
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. In addition, multifamily homes remain attractive due to supply shortages and rising rents.
V. Strategic recommendations: How to capture opportunities in 2023?
🏘️ Buyer strategy:
Choose growth cities such as Atlanta, Dallas, Orlando, etc., rather than some southern city clusters with "high construction and high risk".
Under the pressure of interest rate costs, investments with a holding period of more than three years have more cost advantages
Realtor
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Focus on real estate cash flow and rental coverage, rather than pure price appreciation.
🏠 Seller/landlord strategy:
Use Home Staging and auction models to bid faster in hot markets.
If the current mortgage interest rate is low, consider refinancing for long-term holding to avoid capital gains tax pressure.
🏢 Investment institution perspective:
Multi-family residential assets and self-storage assets (self-storage REITs) attract capital allocation
MarketWatch
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Avoid short-term placement of commercial real estate (especially low-quality offices), and prefer logistics and data center assets.
Summary: The US real estate market will move towards "structural differentiation" in 2023, and caution is a good policy
2023 is not a year of nationwide surge, but a stage of structural adjustment with demand mismatch, regional differentiation, inventory and policy boundary resonance.
Some rapidly expanding cities in the south may face oversupply and price adjustment pressure;
Stable cities in the Midwest and Northeast have tight inventory, less speculation, and more value resilience;
Inflow growth markets (Atlanta, Dallas, Orlando, Phoenix, San Diego) show elasticity with population and employment trends.
For buyers, sellers and institutional investors, early research and evaluation of regional sustainability and economic drivers are the key to ensuring steady progress in the real estate market in 2023.