Real estate has been soaring in 2021, and there’s no denying that. It might be helpful if you haven’t purchased or sold a home this year, and you’re considering doing so in the future.
The 30-year fixed mortgage rate was 2.98 percent as of Nov. 10, which is the lowest it has been since Sept. 23, when it was 2.97 percent. There is no doubt that you’re relieved that interest rates aren’t soaring, but how long will this last?
Experts in the real estate industry have given their predictions for the housing market in 2022. These are their thoughts.
Big Cities Have the Potential to Reignite Their Booms.
As a real estate broker in Santa Rosa Beach, Florida, and founder of Spears Group, Jonathan Spears says the U.S. housing market will continue to gather momentum in 2022.
According to him, the Northeast, Southeast, and West Coast would experience the most growth in urban markets as people become more comfortable returning to big cities.
Because the market had grown by nearly 30% the year before, he noted, “it may appear as though real estate markets have halted,” despite some market prognosticators projecting gains in market values of up to 15%. There will be a lower rate of absorption because there isn’t enough inventory to go around.
Despite this, he still expects a healthy increase in the overall U.S. real estate market.
Potentially Slowing Down the Rate of Home Value Appreciation
According to Cornerstone Home Lending, Inc. COO Andrina Valdes, several housing authorities have predicted increases in home values of 2.8 percent for existing homes and 4.4 percent for new homes by 2022, including Fannie Mae and the National Association of Realtors, respectively.
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As long as property values aren’t depreciating, the pace at which they’re rising should slow down, she added.
Even if mortgage rates go up, it may still be a good time to buy a house.
According to Valdes, mortgage rates are predicted to climb somewhat next year but remain at historically low levels.
A “cooler” marketplace than in 2021, but one that will still be “dynamic” has been predicted by her. It may still be a sellers’ market, but there are likely to be more options and wiggle room for homebuyers..”
As a result, she suggested that now is still a fantastic time to buy a house.
According to her, a customer who feels “priced out” should have a lot more options available. As a result, experts say that the housing market in 2022 is not at risk of collapsing, because the current conditions are not comparable to those that preceded the financial crisis of 2008.”
Chief Economist Danielle Hale of Realtor.com concurs that purchasers would likely be able to receive more value in 2022.
After peaking at 17.2 percent in April, she noted that the median listing price increase had slowed to 8.6 percent in October. “Sales prices have slowed down, although not as much as previously expected.”
She did say, though, that this is something that will probably change.
“We expect this slowdown in pricing to continue,” she said, “with prices approaching all-time highs and mortgage rates expected to rise.”
There’s good news for both parties involved in a real estate deal: According to Jason Gelios, a real estate agent in Southeast Michigan, prices will stabilize but remain robust in the 2022 housing market.
This year’s frenetic seller’s market will allow many first-time homeowners who were unable to compete with stronger buyers to bid on homes to do so in 2022,” he said.
It’s likely that the housing supply will be lower than it should be, so purchasers should be prepared to pay around the asking price.
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Stocks are likely to remain low for some time.
Blue Ladder Development’s Bill Samuel, a residential real estate developer and owner of a Chicago-based home-buying company, concurred that a scarcity of available properties for sale will likely persist in the coming year. “
There will be several offers on most of the properties you’re interested in through 2022, said Samuel, a real estate broker himself. Inventories are still low, although they are slightly higher than they were at the beginning of this year (2021).
COVID’s efforts have made the market more competitive than it was before COVID began.
Because the supply of homes for sale is limited and buyer demand is increased due to cheap mortgage rates, he claims the epidemic has benefited the property market.
Beginning at the end of 2021, the typical sequence of foreclosed homes will resume, he said. This means that the number of residences for sale will likely rise.
This year’s supply of available homes is predicted to be higher, but still well below the levels seen before the epidemic, according to experts.
‘In my judgment, the market will continue to be strong throughout 2022,’ he said. The property market and total demand, however, are not expected to be as hectic as in 2021, according to “However, I expect.”
In 2022, the real estate industry will have to wait and see what happens. If nothing else, these professional viewpoints should give you food for thought as you begin to make resolutions for the next year.