In the next few months, we’re going to bid adieu to 2021 and pray that 2022 will be different. Real estate agents, in particular, are keeping close tabs on current housing trends so they know how to prepare for the 2022 real estate market.
If you’re thinking about selling property or buying a house in the upcoming year, you don’t want to ignore these predictions!
1. High prices scare buyers
Over the past year and half, housing prices have increased steadily. Despite this, buyers didn’t balk at those high prices because the low interest rates kept their monthly payment reasonable. However, today 54.4% of realtors say that now that rates are rising, their clients are backing away from the closing table.
2. Improving public health is good for inventory
Across the country, the vaccination rate continues to improve and as a result of this, 32.9% of agents say people are beginning to feel safer going outside. These agents say sellers who pulled their homes off the market at the height of the pandemic are starting to relist, which is great news for markets where inventory is still on the low side (which is almost everywhere).
3. Bidding wars are on the decline
If we were to look back at this time last year, bidding wars were pretty much a common place. 52% of agents reported that many of their clients would receive numerous offers and the seller could kick back and wait for the best offer to come through. That isn’t the case today because, as we mentioned, as people begin to feel safer, more houses will come on the market. With more houses to choose from, 54% of agents believe properties in their area will not see as much action as in the past and properties could see just two or three offers… at best.
4. Cash buyers are more favorable to sellers
In most cases, when you’re going to buy a house, you’re going to want a pre-approval letter in hand. That letter tells everyone (agents and the seller) that you’re a serious buyer and funds are pretty much a guarantee. Unfortunately, that’s not the case right now. Yes, even though you’ve been preapproved for a mortgage, if there’s a cash offer on the table, the house will almost always go to the cash buyer. It’s nothing against the buyer per say, but when it comes to hundreds of thousands of dollars… A seller will choose the cash offer because that’s cold hard cash in their hand and there’s no possibility that the deal would fall through.
If you’re a buyer needing a mortgage, you need to be mentally prepare yourself for the possibility of a cash offer on the property.
2022’s housing market predictions can change
As disparaging as these predictions may seem from a buyer’s point of view, nothing is set in stone. That’s why we highly recommend that before you decide to do anything in the real estate market, consult a trusted realtor. They’ll know the finer details about your market and give you their advice regarding your options and what would be in your best interest.