The year 2022 is quickly approaching and it might be hard to believe that we will have been here before. As part of this feeling, you could be wondering about your chances of buying a home in the near future after 2021 left with few opportunities for such an endeavour! But what does history tell us?
The predictions are looking promising with records set last year which may mean more success ahead – let’s hope so anyway!!
Cities Could Surge Again
Following the pandemic’s start, many people relocated to suburban areas and less expensive states. This means that some parts of New England might see an increase in real estate action again soon enough – though we don’t know how this will continue or whether there are any headwinds left for large metro cities like New York City where sales have been slow as ever since before Back To School season started coming up early last year due primarily because so many families wanted property close by just waiting out what they thought would be another short-lived disaster.
The Housing Boom May Lose Some Steam
The home price appreciation rate over the last year was 19%. This is a 12-month record and one that may have fans of real estate market bubbles excited, but it also signals some slowing down from boomers. Indicators seem to suggest an impending cool down during the winter months which could be due both in part to seasonal effects as well as buyers waiting out increasing prices before purchasing their next property investment asset.
Also Check:- JDA Housing Scheme 2022
With the Federal Reserve likely to raise rates in order slow inflation, buyers may find themselves priced out of homes. October saw over 60% bidding wars compared with an all-time high of 74%.
Home prices are predicted to increase by as much at 13% within the next year, according to Zillow. This prediction was made after research showed there is currently an imbalance in supply. And demand for homes could lead to further price hikes down. The road if nothing changes soon – especially considering how long this current shortage has already lasted!
Goldman Sachs offers a more alarming 16%. But they also say that unless something major lands on their desk then things may play out differently. What’s been happening thus far.
Zillow and Goldman Sachs both believe that the first-time millennial home buyer wave is not easing up. The largest birth years of 1989 through 1993 will be hitting their 30s this coming decade. But some analysts predict there won’t be enough homes for all future demand. Because America has had such an extreme shortage in construction over recent decades as well. With z scoring only 2% growth rate per year on average since 1996!
Fannie Mae predicts US House Price Growth Of 7%.
Freddie Mac estimates 6%, which isn’t too far off from historical norms either way. But still considerably lower than what we’ve seen thus far.
The Mortgage Bankers Association is forecasting that, by 2022, the average 30-year fixed mortgage rate will be 4%. In a time when many people are looking for stable careers with ample opportunities to grow in their field of expertise. Or choose from different career paths altogether. It may become increasingly difficult if not feat impossible altogether due to financial constraints. Which makes it hard enough already without adding additional expenses such as higher interest rates on loans/credit cards etc.
With prices still gradually increasing, it’s hard to see how a crash would occur. Even with the Mortgage Bankers Association predicting upcoming Drops in Home Values and Interest Rates; U.S.-based homes are projected by most experts as being worth around 20% higher than before the pandemic reached. Its peak last year.