3 Things to Know About Our Red-Hot Housing Market

Here’s how you can make it as a buyer in a red-hot housing market.

Our red-hot housing market caused some homebuyers to put their plans on

hold in 2021. In 2022, many of them will return to the market. 

If buying a home is one of your New Year’s resolutions, you’ll be relieved toknow that it should be much easier to accomplish that task than it was in 2021.

Here are three things all homebuyers should know in 2022:

1. The market is easing up for homebuyers. New data from the Common

Haus Price Index, which tracks asking prices for three-bedroom, two-bathroom

U.S. homes, shows that the year-over-year rate slowed from 5.9% to 5.4%.

That’s the smallest year-over-year price growth since January 2020. 

Additionally, prices have started to slide back down from their 2021 peaks, and

supply is bouncing back at the fastest pace we’ve seen since May. This will

give you more options and better prices as a buyer.

“A 4% rate is still extremely low based on historical averages.”

2. It’s important to be flexible in this market. Although supply is on the rise,

inventory is still very low from a historical perspective. This means that you

need to have a plan in place before you even begin your home search. You’ll

need to be prepared to act quickly when the right home hits the market, and

be patient in case your first offer isn’t accepted.

3. Rates will likely rise, but not by much. It’s clear that home prices have

been inflated over the past year or so, but competitive mortgage rates have

helped offset them. Rates will rise in 2022; it’s inevitable. However, the

Mortgage Bankers Association predicts a modest increase in the 30-year

fixed-rate mortgage average to around 4%. This will make homes less

affordable than they are right now, but a 4% rate is still extremely low based

on historical averages.

Only time will tell if 2022 will be a great year for homebuyers. However, the low

rates we’re seeing won’t last forever. Locking in a low rate on a long-term

investment like a home puts you in a great financial position for the future.

If you have any other questions about buying a home, selling a home, or real

estate in general, feel free to give me a call or send me an email today. I look

forward to hearing from you.

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