Author: Vicky Lanson
Many consumers suffered from inflation in 2022. Prices increased more quickly than salaries on average, decreasing the average consumer’s purchasing power.
Some products become so pricey that consumers simply abandon them.
This year, consumers should exact some justice. Inflation has generally declined, from a maximum of 9% in June to 7.1% in November. There may be a lowering inflation rate in several categories of products and services. ‘There will be deflation in several segments or a complete drop in price levels.
Here are some top things that could become cheaper in 2023 so you can save money and live better.
Since continual improvements in computing power consistently offer more bang for the buck, the cost of computers, smartphones, and other gadgets often decreases over time.
Beginning in 2022, the cost of electronics increased slightly due to chip shortages, the work-from-home boom, and a rise in equipment demand.
However, that tendency has now changed. In addition, declining demand in 2023 resulted in fantastic discounts on numerous electronic products.
In 2021 and 2022, as the economy began to recover, hotel rates increased as the lodging sector battled to meet demand and rehire more staff. These issues have largely been resolved, and pricing has returned to normal. Watch for price reductions if a recession occurs in 2023.
In April 2022, the inflation rate for brand-new cars reached a high of 13%. Last February, it reached an absurd 41% for used autos. Because automobile manufacturers could not finish producing millions of new vehicles and customers became dissatisfied, secondhand car sales increased due to the semiconductor shortage. According to Kelley Blue Book, the average cost of a new car rose to about $49,000 during the epidemic. It won’t last long. The semi-shortage is now decreasing. However, there may be an excess of new vehicles by the second half of 2023, which would cause prices to return to more acceptable levels. Prices for used vehicles will decrease more quickly.
As property demand slows due to rising interest rates, rents are anticipated to decline. Between September and November, the Zillow observed-rent index fell for two months. And it appears that this will continue. Rents had decreased just a little from their 2022 peak when they were around 25% higher than pre-COVID levels.
A further decrease of around 10% is indicated if pre-COVID tendencies return.
Since rents are typically fixed for the duration of the lease, many tenants won’t profit until they sign a new one.
These need semiconductors as well, and by the start of 2022, shortages caused the price of appliances to rise by about 9% every year. The end of 2022 saw a slowing in appliance prices, and 2023 may see a start of a downward trend.
The Bottom Line
2023 is shaping up to be a great year for consumers. With inflation on the decline and decreases in prices of electronics, cars, and housing, there are numerous opportunities to save money and live better. Keep an eye out for price reductions and take advantage of them when they come around!