SPRING 2022 HOME BUYING SEASON PREVIEW
The 2022 real estate market is shaping up to be something closer to normal.
As we approach the busy spring home buying season, buyers are still likely to face an uphill battle, but it shouldn’t feel anything like 2021.
Home values skyrocketed by nearly 20% at many points in 2021. While housing prices aren’t expected to drop in 2022, the increasing rate of prices should slow down. Many experts believe home values will increase at roughly half the rate (single-digit increases) we saw during the peak of 2021.
Buyers may still face bidding wars, but they aren’t likely to be as intense or as frequent. That means sellers may not be as selective when choosing between offers. In 2021, all-cash offers and conventional loan offers with appraisal contingencies waived were often needed to win the bid. This year as a buyer, you may be able to be more flexible with the terms of your purchase contract, even if you aren’t necessarily getting a deal on the price.
If you’re planning on buying or selling a home during the spring 2022, here are 7 takeaways that you can use to prepare.
3 Takeaways for Buyers
- Low housing inventory and high demand will create a strong seller’s market, but not as intense as the peak of 2021.
- Home prices are expected to continue rising, but at a slower pace than last year.
- To avoid house buying FOMO (fear of missing out) and panic buying, know what you can afford and stick to a realistic budget.
4 Takeaways for Sellers
- It will still be a strong seller’s market, but compared to 2021, there will be a smaller likelihood of a bidding war driving up your sale price.
- Get ahead of preparing to sell your home. Repairs and upgrades are taking longer to schedule and complete due to shortages of supplies and labor.
- All real estate is local. Some markets, or sub-markets, may be stronger or weaker than others.
- Work with a local real estate professional that knows your local market.
In the coming months, mortgage rates and home prices are forecasted to rise. This will cut into your buying power, so it’s important to begin preparing financially as far in advance as possible. Building your credit score can help you qualify for a lower mortgage rate. You’ll want to save for a down payment, closing costs, and unexpected repairs and maintenance. Now is also a good time to start looking into first-time homebuyer programs. These programs can provide thousands of dollars to put toward your down payment or closing costs if you qualify.