Money Management

What does June have in store for the U.S. real estate market? Read on to find out. 

If you’ve been trying to buy a home in 2023, you may be experiencing your share of challenges. The U.S. housing market still favors sellers, even though it’s cooled considerably over the past year. If you’re still in the process of hunting for a home — or if you’re thinking of selling yours — here are some things you may want to gear up for in June.

1. Mortgage rates are unlikely to budge

Mortgage rates have been stuck in the 6% range since the start of 2023 for 30-year fixed loans. And as of mid-May, the average 30-year mortgage rate was 6.39%, according to Freddie Mac.

It’s unlikely that mortgage loans will become much more affordable in June. Could we see rates dip down toward the lower 6% range? Sure. But we’re not so likely to see 5% mortgages, as rates seem to be in a bit of a holding pattern.

2. Housing inventory might pick up, but only slightly

As of the end of April, there were 1.04 million unsold homes on the U.S. housing market, according to the National Association of Realtors (NAR). That’s a 7.2% lift from the previous month, which is an encouraging bump.

However, that level of inventory puts available homes at a 2.9-month supply. And it generally takes a 4- to 6-month supply of available homes to meet buyer demand in full.

Because the U.S. housing market still lacks inventory, as a buyer, you might struggle to find a place that meets the right requirements and that’s affordable to you. It also means you might face your share of competition from other buyers.

But if you’re a seller, low housing inventory is the sort of thing it pays to capitalize on. A lack of competition gives you more of an upper hand. But do be aware that if you sell your home and need to finance another one, you could end up with a much higher interest rate on your mortgage than what you’re paying now. So you’ll need to weigh that con against the upside of potentially commanding a higher price for your home.

3. Home sales could decline

The NAR reported that as of April, home sales were down over 23% from a year prior. That trend could continue in June.

Buyers have been hesitant to enter the market due to higher mortgage rates. And also, if inventory remains low, it could lead to slower sales numbers.

Now to be clear, sellers don’t have to panic over that 23.% decline. There’s still plenty of demand out there. But it’s a trend worth tracking nonetheless.

Should you buy or sell a home in June?

All told, buyers and sellers alike might face challenges when transacting in the real estate market in June. As a buyer, you might struggle with higher borrowing costs and limited options for homes. As a seller, you might have a hard time affording a new home, even if you manage to sell yours quickly at a decent price.

Ultimately, you’ll need to consider your options carefully before making the decision to buy or sell. It’s easy to make the case that June is a good time for either, but you could just as easily argue that it’s better to wait.

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Sometimes, having accounts at more than one bank can be a hassle. Read on to learn why one writer is embracing it — and watching her savings balance grow. 

I used to be a banking loyalist, as I’ve had a relationship with a big national bank since my undergraduate days, and that has included maintaining both a checking and a savings account with that institution. But while the checking account is fee free, the savings account charges me if my balance drops below $300, plus the APY is nothing to write home about.

So when I started freelancing in 2022, I opened a high-yield savings account at an online-only bank on the advice of my financial planner. At that time, I just needed a place to keep the money I owe the IRS and my state every quarter to cover my estimated taxes (as a freelancer, it’s on me to make those payments). I figured it would be nice to earn some interest on that money along the way.

When it comes to money, being loyal to one banking institution may not always benefit you. And if you’re still keeping all your money at just one bank, you’re missing out on a host of potential benefits. In addition to getting a much higher APY on my online savings account, I’m also finding it easier to save money and resist the temptation to spend, thanks to the extra legwork required to move money between multiple banks. Here’s how.

Making a payment app work for me

I get paid by my freelance clients via direct deposit. I have those payments set to come into my checking account at the big bank, and I then distribute the money from there. Some of it goes to pay my bills, but before I do that, I take out Uncle Sam’s cut as well as money for my savings goals (more on that below). Rather than using a traditional bank transfer to send that cash to my online-only bank, I use a payment app that works with both banks.

However, I discovered pretty early on in this process that the money only moves quickly in one direction. Cash sent from my big bank to my online bank credits immediately. I have a process for making my tax money/savings transfers — I sign into my big bank’s website, initiate the transfer, then log out and sign into my online bank’s website and further distribute the money. By the time I change accounts, the money has already hit my online savings account. How convenient!

But not so fast. If I need to move money back in the other direction (online bank to big bank), it’s not an instant transfer. Instead, it takes a day to happen. This is the kind of inconvenience I don’t mind, however.

My savings goals changed

Near the end of 2022, I gave my online savings account a new job — I started putting money away to buy a home. This means that a lot of the money in there has a longer timeline than my quarterly tax payments, and it’s even more crucial that I earn a generous APY on it. This actually turns the inconvenient transfer time into an advantage. Why?

It gives me a greater sense of security to know I can’t just tap that money in the blink of an eye. And as I shell out various bits of money along the way to homeownership (such as an earnest money deposit, paying a home inspector, and so on), I’ll have to plan accordingly, giving me the time to budget and consider my expenses ahead of time.

My online savings account also let me set up different sections within the main account for different savings goals. Along with saving for a house, I also have spots for mundane goals, like cash to pay for vet visits for my cats, as well as for fun things like travel. I really enjoy watching the money in those increase over time, and I love that I can fund them in an instant, but it requires more time and planning to get the money out.

Knowing that cash can only be transferred instantly going in one direction has made it easier for me to park money in my savings account — and harder to justify pulling it out. What’s not to like? If you’ve got all your money with just one bank and are saving for a big goal, I recommend moving your savings to a different bank (and if it’s one that pays a higher APY, all the better!). You might just find that this inconvenience works out well for you too.

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Interested in a starter home? Read on to see when your first home is likely to be the home you stay in for good. 

If you’re looking to buy a home in 2023, you may want to consider purchasing a starter home. Mortgage rates and home prices are both elevated this year, and buying a starter home might allow you to buy a place that works for your budget.

This year, 59% of prospective buyers say they’re looking at a starter home or fixer-upper, according to TD Bank’s First-Time Homebuyer Pulse. But don’t assume that your starter home is a place you’ll only live in for a handful of years. Here are a few signs that you may end up buying a starter home that becomes your forever home.

1. It’s in a neighborhood you love — where there’s not a lot of turnover

You might have your heart set on a specific neighborhood — perhaps one with tree-lined streets, nice parks, and access to amenities like shops, cafes, and restaurants. If the neighborhood you’re targeting doesn’t tend to see a lot of turnover (namely, because so many people love it there), but you manage to find a starter home, assume there’s a chance you’ll stay for the long haul — not because you can’t afford a larger place, but because one may not become available.

2. It’s large enough to fit your family from the start

Some people buy a starter home and then upsize once their families grow. But if your starter home can accommodate your family from the get-go, then you may decide to just stay in that home for the long haul.

Let’s say you’re a family of two adults and one child, and you’re certain you’re done having kids. If you end up buying a three-bedroom starter home, you may find that it offers enough space for you all to spread out and live comfortably. And you may also decide that it doesn’t make sense to upgrade and take on a larger mortgage loan when your current home is more than sufficient.

3. It’s a home that requires a lot of work

It’s not always the case that a starter home will require a substantial amount of work. But sometimes, that is the case. And if you’re buying a starter home you know you’ll need to sink a lot of money into, don’t be shocked if it ends up being the home you stay in for good.

It can be hard to save up for a larger or more updated home when you’re forced to spend money on many major repairs on your current home. And while you will, ideally, be able to build some equity in your starter home that could help you upsize in time, you may find that it’s just not feasible due to the amount you’ve spent.

Some people buy smaller homes to start with and make the decision to just stay put. If that’s a route you end up taking, know that there’s nothing wrong with it. If anything, it probably means that you’ve found a pretty great place to live, and that you can see yourself being happy there on a long-term basis.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.Maurie Backman has positions in Target. The Motley Fool has positions in and recommends Target. The Motley Fool has a disclosure policy.

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A few years ago, my husband and I decided to try to grow a garden in order to save money on fruits and veggies. Read on to learn how it went. 

Several years ago, my husband and I decided we wanted to try to get serious about gardening. We were spending a fortune on fruits and vegetables because we want to try to eat local, organic foods as often as possible. And we thought perhaps if we grew our own food, we would be able to save some money.

Here’s how that’s panned out for us over the past couple of years. Spoiler alert: our checking accounts did not thank us for the effort.

Starting to garden can come with big upfront costs

While my husband and I had grown a few tomatoes in pots here and there, we had never been serious about gardening before — and we didn’t really have a good place to do it.

We decided to opt for raised-bed gardening after doing some research, as our soil here isn’t very good (it’s rocky and not conducive to growing anything). So we spent about $800 on cedar and a delivery of organic dirt so we could get six raised beds going.

We have a lot of critters in our area, so we also decided to spend some money to put up a DIY fence. We purchased some no-dig fencing from the home improvement store, which ended up costing around $400 for all the fencing we needed. This expense went on our credit card.

We also bought seeds, a DIY drip-irrigation system so our crops would be watered even if we traveled during the summer, and some chicken wire to help keep critters out. These costs together came to around another $200.

So, all-told, we had spent around $1,400 upfront out of pocket to get our gardening endeavor started.

Here’s how it panned out

In the first year or so, we got a ton of food from our garden. We were able to grow enough tomatoes and peppers to make many batches of salsa, we didn’t need to buy celery or carrots from the grocery store after our garden started growing, and we saved on lettuce greens, peas, broccoli, and beets. We estimated we saved about $550 over the course of the year with all of the produce we did not have to buy.

Things started to go downhill from there, though. In year two, we had very dry weather and while our garden was OK because of the irrigation system, there must not have been a lot of other vegetation for animals out there because our garden was under serious attack from rabbits, groundhogs, and deer. We bought an owl statue and did everything we could to try to scare off the creatures, but we mostly ended that year with a few tomatoes, cucumbers, and strawberries, and not much else to show for our efforts. We saved about $100 at the grocery store.

In years three and four, the animals obviously remembered they had a great place to dine and ate most of our seedlings before they were even able to grow and start producing food. Some of the nutrients from our soil must have also been depleted, because not as much grew. We still saved around $25 though, since there was one tenacious cucumber plant that stuck around.

We started to get bored with the endeavor and had kids in year six, which left us too busy to do much garden tending and we ended up not producing anything at all.

The final cost of our gardening adventure

So, our garden endeavor ended up costing us about $775 not including added water bills, and we now have a garden that’s mostly empty — and if we do go back to it when our kids get older, we’ll probably need another soil delivery.

Moral of the story: If you’re going to try to garden, don’t make a big upfront investment unless you are sure you will stick to it, and don’t assume you’ll make your money back, as growing food isn’t as easy as it may seem.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

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