Home prices will remain steady, sales will drop and mortgage rates will settle in at less than 6% in 2023, the National Association of Realtors® predicted Tuesday.

The projections come during NAR’s fourth annual year-end Real Estate Forecast Summit. 

NAR’s Chief Economist Lawrence Yun outlined the association’s expectations for the coming year. They include 4.78 million existing home sales, a 0.3% increase on the median home price to $385,800 and mortgage rates of 5.7%.

“Half of the country may experience small price gains, while the other half may see slight price declines,” Yun said in a news release. “However, markets in California may be the exception, with San Francisco, for example, likely to register price drops of 10-15%.”

Yun also predicted rents will rise about 5% in 2023, which is on top of the 7% increase seen this year. He expects foreclosure rates to remain historically low, comprising less than 1% of all mortgages in 2023.

NAR also selected the 10 real estate markets it expects to outperform other metro areas in the coming year. All of those markets are in the Southeast and South. They are, in order:

1.     Atlanta-Sandy Springs-Marietta, Georgia.
2.     Raleigh, North Carolina.
3.     Dallas-Fort Worth-Arlington, Texas.
4.     Fayetteville-Springdale-Rogers, Arkansas-Missouri.
5.     Greenville-Anderson-Mauldin, South Carolina.
6.     Charleston-North Charleston, South Carolina.
7.     Huntsville, Alabama.
8.     Jacksonville, Florida.
9.     San Antonio-New Braunfels, Texas.
10.     Knoxville, Tennessee.