Trend# 1: Home Prices Will Rise Slowly with fewer offers
If you are keen on the house price in 2018 and 2019, you can bear witness that home prices made a giant 10% jump. Wow! However, it may be a different story coming year. It’s estimated that home prices will rise in 2022 but at a much slower pace while the number of homes for sale is expected to rise by only 2%.
What is the reason?
One major contributor is overall economic uncertainty, and another part of the slowdown is due to the high fees titling process that hinders mortgage uptake.
The combination is enough to discourage homebuyers who have a desire to purchase a home.
However, the market still has eager buyers searching for newly built homes. The good news is, it is estimated that the number of newly constructed homes will increase by 8% in 2022. The bad news is, there will be fewer homes in some areas. Besides the construction companies lacks the manpower to keep up with the increasing demand.
The bottom line is, expect the newly built houses to go at a higher price.
What Will High Prices Mean To The Sellers?
There will be a possibility of high profits! Even though at a low pace, the number of houses to be sold is still expected to rise in the course of next year. That’s is a piece of excellent news to the seller, however, have in mind that many buyers will be priced out of the market-leading to fewer offers for your home.
What is the solution to this?
Be aware of the competition; with fewer offers in the market, make your home stand out in your area. Make the home perfect for the potential buyer and work with a professional real estate agent who can help to list your home at the appropriate price.
Also, be patient and wait for the right offer, the one that gives you the highest profit. Some buyers may try to gut punch you with a low offer. Remember, when negotiating, the less desperate person usually has the upper hand.\
What Will High Price Mean For Buyers
If you desire to own a home in a lavish neighborhood, find out the one you can afford and figure out the amount your monthly payment your budget can handle. Don’t rush into purchasing a home that makes no financial sense to you no matter the pressure you may be having. Commit to staying within a budget that won’t put pressure on you.
If you can’t afford to put aside at least 10% on a 15-year fixed-rate conventional loan, then most likely you can’t afford a house in this market. Any down payment of less than 10% will strangle your budget with a few months of a mortgage payment.
If you are committed to buying, but you are on a tight budget, here are some helpful tips you can consider:
Sacrifice some wants – be willing to give up some “nice-to-haves” for your “must-haves” for you to afford that house you want.
Upgrade your income – find a new job that pays better or gets a side business you can do to increase your income.
Expand your search – maybe you had a target of buying a house in a specific neighborhood that is more expensive that is busting your budget. You might be surprised to find a gem in a less popular neighborhood. Once you are connected with a property agent, who knows the areas is the best way to find a home that fits your lifestyle and budget.
Trend #2: Majority of Home Buyers Are Millennial
You better believe it! Millennials are busting all over, finding stable careers, before they get older. They are the leading ones in getting first homes in mile and upper-mile class neighborhoods. Baby boomers are downsizing and retiring, leaving the game to the millennials. As it has started to happen from early this year, next year millennials will lead in taking mortgages.
What Does It Mean To The Sellers (When Millennials Are The Leading Home Owners)
Know Your Buyer; these are three essential tips buyers should have in their mind.
For millennial buyers, the sellers should know that they are internet savvy, and do proper house shopping (both online and offline). That is why sellers should work closely with a house agent with online knowledge to market the house.
Millennial look for;
Quality oversize – it’s true, square footage matters, but the millennials are more concerned about how usable or sustainable each space is. Help them visualize a bright future in your home.
Easy online shopping – as mentioned above, millennial starts their home search from the internet online. Thus you need to make the best possible impression on the internet.
Location – the majority of millennials are looking for houses in places that offer a big city life with a more affordable cost of living. If you have a home that is accessible with public transit and it is a workable area, expect millennial to come knocking at your door.
What Does It Mean for Buyers (The Millennial)
Know what you want. Decide what you need and what you can’t do without in your house. If you are married and looking for a house, the two of you need to agree on must-haves. Combine your lists to be a foundation that your real estate agent will use for your home search.
Last year, 95% of millennial homebuyers used a real estate agent to buy their real homes. They surely know something, thus don’t buy on your own, get help from a pro, and the process will be smooth for everyone involved.
What if You Are Not Selling or Buying home In 2022
You might be thinking, all this sounds great, but I do not have any plan to buy a house this year. That’s why we are here; what you need to know is;
Real Estate isn’t going to crush
From the looks of things, the real estate market is not going to crash anytime soon
Some people are wondering, with this fast-rising mortgage interest, will it make the housing market collapse? Well, here is the truth. Several factors indicate that the economy and the housing market is still active and strong:
Millennial still wants to buy
There are new career opportunities
All-cash real estate buyers are becoming popular
People are spending money
Buyers will still be interested regardless of the neighborhood
Although buyers in 2022 may be choosy, know that many buyers are willing to take a neighborhood that isn’t close proximity to a big city or doesn’t have easy access to the highway. If you think that your house is located in an interior neighborhood and can’t be desired by buyers, think again. This can be your perfect time to sell.