What can you expect from the home market in 2022?
Real estate sphere interests not only people working in this industry but also ordinary individuals planning to buy, sell, or rent properties. No wonder there is a quite big number of people excited to know what an upcoming year has in store for the real estate business. Naturally, it is impossible to make accurate predictions, but there is a chance to analyze the viewpoints of several experts and make clear conclusions on this basis. As a result, you will get an idea of what to prepare for and how it can influence personally you.
2022 Real Estate Market: Experts' Predictions
It goes without saying that 2021 was characterized by incredible growth in the housing market. Naturally, this tendency will partially remain in 2022 too. This is explained by the post-pandemic recovery with lower mortgage rates, return to jobs, increased supply and demand, etc. Undoubtedly, the last one outnumbers existing inventory much, but it doWhat can you expect from the home market in 2022?es not prevent buyers from entering the market.
So what should you know about the housing market of 2022? Here are several predictions made by experts.
Home prices will continue to rise
The analysis of the predictions made for 2021 and real data made it possible to conclude their authenticity. Furthermore, the forecast for 2022 depends much on the previous year too. The number of sales is going to remain at the same level but there is quite optimistic news for buyers too. Undoubtedly, home prices will continue to rise but the increase will be only around 7%. It is twice lower than in 2021. When it comes to mortgage rates, the increase will be around 0.5% in comparison with the previous year.
Undoubtedly, these numbers are approximate and can go up and down, but the truth is that there will be an increase in home prices. The main reason for that is the growth of the median home cost which is around $353,000 now.
The demand for the properties will continue to be strong
These are general tendencies all around the country, but what about the buyer to seller ratio by state? A survey conducted among real estate agents showed that home buyer traffic is high almost all around the country. The biggest numbers are observed in the western, southern, and central parts of the USA. Only Utah and Idaho follow behind.
It means there are enough buyers willing to make a bargain, and this is a fortune for home sellers.
The selection of inventory will be insignificant
The seller traffic isn't that big like buyers, so it may take more effort for a person planning to purchase properties to find a good example to invest in. Undoubtedly, there are states where the offer is quite extensive, and there are more chances to buy a dream house including Nevada, Oregon, Iowa, and Oklahoma. However, the situation in the majority of US states looks less promising: half of them have standard seller traffic, while the rest face low one.
The average time real estate will spend in the market in 2022
The speed of home sales will remain high in 2022. The average time spent by properties in the listings was 21 says in fall 2020, but now it has been reduced to 17 days only. Naturally, this is good news for sellers who want to earn money faster. On the other hand, it can be frustrating for buyers who have no time to think long over the example of property or it may attract another individual. Consequently, when you like a home for sale and it meets your budget expectations, it is better to close the deal without delays in 2022!
The number of foreclosures
Foreclosures become more popular every year, but the pandemic has left a negative impact on this tendency. At the same time, people can observe a rise in the number of foreclosures in 2021. There could be an increase over 20% for only a month, while the total number of foreclosures has grown by 100% in comparison with the previous year. It means the revival of this activity, though reaching the success of the pre-pandemic period seems to be a painstaking task. However, the number of foreclosures predicted for 2022 will be approximately the same as this year.
What does it mean for sellers and buyers? Homeowners might have trouble with making timely mortgage payments in case of job loss if the government bans foreclosures. On the other hand, buyers will be lucky to get a discount, though the idea of buying a home with potential challenges must be a well-thought decision!
Can you expect the housing market to crash in 2022?
Experts predict that there is no sense to wait for a market crash in the next several years. The current situation in the real estate sphere has little in common with the one in 2008 and 2010 which was a real bubble. The mortgage rules of 2021 are stricter, so there are fewer risks involved and the probability of default is minimized too. Another reason to prevent it is a quite high housing supply, so there won't be a significant price drop in the nearest future too.
The main rule sounds as follows: until there are new buyers who join the market and the demand for homes for sales is not met, it will increase home prices and guarantee the health of the real estate market.
Should you buy a home in 2022?
It is a good idea to make a purchase of the home in the upcoming year if you have prepared for that. It is important to have enough finances and stage of your life. You should ensure to be free of debts, have savings for an emergency situation, and prepare a down payment of around 20%. If you can't meet these qualifications, it is not a good idea to make this costly purchase.
What can homebuyers expect to see in 2022?
Undoubtedly, the first thing buyers will see in the housing market next year is heavy competition and increased prices. However, it does not mean there isn't good news for buyers at all. Interest rates in the mortgage look quite promising though it may grow a little too.
One more advantage is a gradual increase in the amount of inventory in the market. It will lead to balance and decrease competition as well.
Things to expect by home sellers in 2022
It will be the right decision for sellers to add a home to the listings in the upcoming year. It is better to do that faster while there is not so much inventory available.
As you can see, there are quite promising news for the next year in the real estate industry and both buyers and sellers will take advantage of it.