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Experts Do Not Expect a Housing Market Slow Down in 2022

Posted on in Real Estate

"libertyvilleIf you have been paying any attention whatsoever to the real estate market, you probably realize that the last two years have been an uphill battle for homebuyers—and first-time homebuyers, in particular. At the very beginning of the COVID-19 health crisis in early 2020, the residential real estate market started somewhat sluggish, but it very quickly took off and has only gotten hotter since then. In late 2020 and through 2021, the housing market continued to sizzle, and existing-home sales hit their highest annual mark in 15 years, according to the National Association of Realtors (NAR).

The red-hot housing market is a boon for sellers but a bane for buyers. Those who are looking to buy for the first time have been especially affected since they do not have any way to capitalize on the seller’s market before buying a home. Unfortunately, if you have been waiting for the market to cool off a little before jumping in, experts suggest that 2022 might not be your year either.

A Seller’s Market

Throughout the country, home prices have risen, and in many areas, we have seen double-digit appreciation. Anecdotal examples have been reported in which homes are selling for much higher than the asking prices—hundreds of thousands of dollars higher, in some cases—and often with no contingencies. On top of this, supply chain concerns have slowed home renovations and raised prices on building materials, flooring, and just about everything else.

The NAR’s chief economist, Lawrence Yun, recently told new outlets, “If people are waiting for a price to decline, well, it’s not going to happen.” Yun said that his models predict continued price gains of 4 to 6 percent in 2022. He also indicated that he expects the double-digit percentage gains to slow and for sellers to see far fewer of the multiple-offer situations that were so common over the last two years. “The momentum will slow down a bit,” he said. “I actually expect home sales to come down maybe 3 percent from last year.”

Other experts are not ready to call for a slow down yet. “The demand is just too high for things to cool off,” said one broker in Phoenix. Another broker in Detroit echoed similar ideas, “I don’t think we’ll see the inventory shortage change this year.” These experts expect rising home values and rising interest rates to contribute to leveling off of the market toward the end of 2022 or the beginning of 2023.

Call a Libertyville Real Estate Lawyer for Help

If you are looking to take advantage of the hot housing market by selling your home, a Lake County real estate attorney can help you do so. We can also help you make smart decisions about buying a home under the current market conditions. Call 847-549-0000 for a free consultation at Newland & Newland, LLP today.



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