What Will Happen in the 2022 Housing Market?

If you’re like most people, you have been watching the real estate market like a hawk. You may have looked up your home value on Zillow, and even considered what it would look like to sell in this market. But then, fueled by thoughts of “But where would I move?", you stop considering it.

You’re in good company.

Prices are high, competition is fierce, and inventory is super low. Typically when people are ready to move on to the next stage of their life, they sell their homes. On average that happens every 7-10 years. But that’s not what’s going on right now. The pandemic has delayed plans for many of us, and that has resulted in historically low inventory. Six months is considered stable, so it’s definitely a tough market for a buyer.

Here are some of the concerns I’m hearing from friends and clients about the 2022 market:

I would love to buy, but I don’t want to overpay. I’m going to wait until it slows down.

The reality: No one is projecting that the housing market will slow down. We do expect appreciation rates to decelerate, but that does not mean that housing prices will drop. The same home today is projected to cost 5.1% more next year, based on the average of all forecasts from leading market analyzers. That, coupled with a projected increase in interest rates, means that a buyer’s purchase power will be lower in the near future than it is now.

I would love to sell, but I’m worried I’ve missed out on the prime time to sell.

The reality: You haven’t missed out on anything. Appreciation is still occurring at above-average rates and multiple offer situations are occurring in one out of every 3 homes sold. Buyers know that interest rates will be going up, so they are looking for their new home today, not tomorrow. Showings are up, and actually are higher than pre-pandemic numbers. Buyer demand is strong, and experts expect that the demand will be strong through the end of the year.

There is so much uncertainty, I’m just going to wait and see what happens with the housing market.

The reality: While there absolutely is a lot of uncertainty in the world right now, there is quite a bit of certainty in the housing market. Here is what we know and what experts are predicting:

1. Interest rates are projected to increase in 2022

2. Inventory will still be a challenge in 2022

3. Appreciation is projected at an average of 5.2%, and the same home today will cost more later this year.

So there you have it. Here at Tamara Williams & Co, we are looking forward to an active Winter selling season and we’ll continue to keep you updated as the year progresses.

Have questions about your specific home or situation? Reach out and let’s chat. All good ideas begin with a conversation….

Happy January!