At the beginning of this year, experts noted that the seller’s market of 2021 had not yet fizzled out. In January, we were still seeing the kinds of unprecedented housing price spikes that we’d seen the year before.
Will this trend continue? Will sellers be able to compete in a seller’s market for the rest of 2022? The answer isn’t quite so simple.
To predict the continuation of a seller’s market, we have to understand what creates a seller’s market in the first place. The truth is that seller’s markets aren’t built to last long.
Read on as we discuss real estate predictions and look into the potential for another seller’s market in 2022.
What Is a Seller’s Market?
A seller’s market is influenced by a variety of factors. Broadly speaking, the term refers to the housing market working in favor of sellers, rather than buyers. When we’re facing the conditions that create a seller’s market, you’ll find that sellers can get away with selling their property well over the estimated value.
Why does this occur? The key is competition.
In 2021, mortgage rates were lower than normal by a long shot. This made the possibility of purchasing a home more widely available to Americans, increasing the demand for homeownership. However, an increase in supply did not coincide; more people wanted to buy than wanted to sell.
When demand outweighs supply, buyers are thrown into a state of competition. In order to secure a home, they have to act fast and offer a high bid. For all intents and purposes, sellers are in a great position to wait for the highest bidder to come along.
Are the Conditions in Place for a 2022 Seller’s Market?
It seems that the conditions are in place for a 2022 seller’s market, but don’t expect the same chaos we saw in 2021. Property values will continue to go up and the housing supply will remain low, but mortgage rates are set to rise.
Predicting mortgage rate increases and decreases isn’t an exact science. However, the Federal Reserve has made it clear that they will increase interest rates in 2022 to combat inflation. Historically speaking, when the Federal Reserve raises interest rates, so do private loan providers.
Does that mean that 2022 is a bad year to sell your house? Not at all.
With the help of great agents like the ones at expectrealty.com, you’ll still sell your home at a record-high price. The difference is that it might take a little longer in 2022.
Sell Your House With Realistic Expectations in 2022
In 2021, we witnessed the explosion of a seller’s market like never before. While sales may slow down a notch in 2022, we don’t expect the scales to tip back in favor of buyers for at least one more year. If you’re going to sell your house in 2022, go in with realistic expectations.
Want to know what else is trending in 2022? From home sales to fashion to celebrity gossip, we’ve got you covered on the latest trends