Let’s go over what the experts are saying about 2022’s market.
2021 was a wild ride for real estate. Toward the end of the year, the market was red-hot, and homes were being snatched up left and right for record prices. Now that we’re in 2022, the market has slowed some, and that’s given us time to take stock. Let’s talk about what to expect in 2022 because the outlook is mixed among experts.
Over the past year, home prices have soared upwards by as much as 20%, but that did little to increase inventory because buyer demand is so high. In 2022, prices won’t rise at the same meteoric rate, which is good for buyers. However, prices are expected to increase still. It’s unclear if the housing shortage will ease up next year despite efforts from home builders to increase inventory.
The team at Goldman Sachs stated, “Of all the shortages afflicting the U.S. economy, the housing shortage might last the longest. While the supply of homes for sale has increased modestly since the spring, it remains well below pre-pandemic levels, and the outlook offers no quick fixes for the shortage.”
These conditions have done nothing to slow buyer demand. Redfin found that, in October of 2021, one-third of homes in over 400 metro areas went under contract in only a week. Lawrence Yun at the National Association of Realtors said of home sales, “Although there should be a slowdown going into 2022, they will likely remain above pre-pandemic levels.”
“Our extreme market conditions have done nothing to slow buyer demand.”
The disparity between buyer demand and the available homes suggests that prices may as well surge throughout the 2020s. Even though builders are constructing new inventory, they are limited by worker shortages and cost increases. The annual rate that they’re building homes at is well below the threshold that we need to catch up. To close the gap, builders would need to double their output for the next four to six years, according to Realtor.com.
If you are a seller, this is an excellent time to list your home. The winter months typically mean reduced competition from other sellers, and the buyers looking at this time are highly motivated. Because both home prices and interest rates are on the rise, you’re sure to fetch a good price from buyers who are feeling the pressure, assuming your home is priced right and in good condition.
If you’re not sure what you’re home is worth, you can find out by clicking this link and entering your address. It will give you an estimate based on sales in your area. If you need professional help selling your home for top dollar and in record time, or if you just have questions about real estate, feel free to call me at 805-712-5116 or email me. I’d love to talk over your current situation and develop a strategy to help you succeed.
