September 7, 2022

Market Predictions Sept 2022

Your Housing Market Predictions for Late 2022

Home prices have continued to surge despite higher mortgage rates and an increase in housing supply—factors that typically put downward pressure on home prices. But the numbers still show the market is quite resilient, and costly.

Many housing insiders warn buyers against trying to time the market as the economy wades through this period of uncertainty.

“Deciding to buy now or wait is going to depend on the individual buyer’s motivation and situation. Waiting may not be a viable option,” says Krista Forsberg, a real estate agent in Edina, Minnesota. “Even if a buyer can push pause on buying to later in the year or 2023, there isn’t likely to be significant improvement in prices or interest rates.”

Housing experts say they are keeping a watchful eye on the economy, which is being pulled in all directions by inflation, skyrocketing gas prices, the war in Ukraine and Covid-19, to name a few. While housing has been the star of the U.S. economy the last few years, there are signs of wear—namely, rising interest rates making it harder for buyers to access affordable housing.

The amount of existing-home sales dropped 5.9% from June to July, marking the sixth consecutive month of declining sales, according to the National Association of Realtors (NAR). The median sales price declined slightly to $403,800—but that’s still nearly 11% higher than a year ago.

Will Home Prices Continue to Rise?

Inflation, high mortgage rates and record-high home prices are chipping away at housing affordability. A typical monthly mortgage payment is 76% higher today than it was in June 2019, according to a report by Zillow. And earnings aren’t keeping up with the inflated costs. While wages grew 5.2% in July compared to the same time last year, they still fell behind the 8.5% increase in inflation.

MBA economists also don’t see home prices falling in the near future. They forecast a 9.9% yearly increase for prices in 2022 compared to 2021 and a 3.1% gain in 2023.

However - “The housing market is continuing to move toward more balance,” the report said. “Inventory levels continue to rise, providing more options to homebuyers who are still actively looking for a new home and price reductions are also increasing, as sellers adjust to the new normal.”

Should I Buy a Home, Now or Wait?

Buying a house—in any market—is a highly personal decision. Because homes represent the largest single purchase most people will make in their lifetime, it’s crucial to be in a solid financial position before diving in.

Use a mortgage calculator to find out how much your monthly housing costs will be based on your down payment and interest rate.

Trying to time the market or predict what might happen next year is not the best homebuying strategy. Instead, it’s better to buy based on your budget and needs. If you find a home you love in an area you love and it also fits your budget, then chances are it might be right for you. However, if you make too many sacrifices just to get a house, you may end up with buyer’s remorse and an expensive albatross you have to offload.

Tips for Buying in Today's Market

Start with a budget and make a pact with yourself to stick with it. Even with a slight uptick in the number of homes for sale, buyers are still facing steep prices and mortgage rates in the high 5% range.

“The biggest thing right now is the disconnect between buyers and sellers,” says Rita Tayenaka, owner of a California-based Coast to Canyon brokerage. “Buyers want to lowball, and sellers want last year’s price.”

While buyers are getting a bit more breathing room now, they should keep in mind that it’s still a seller’s market while they consider their options.

So, as a future home buyer...

What should you do NOW, if you are thinking about Purchasing a New or "New to You" Home in the next few months?

Simple!

Contact Maida Quintero. Click HERE to do just that.

Tips for Selling in Today's Market

The first step for a successful sale is to find a listing agent who knows the area and comes highly recommended. A good agent will work closely with you to price your home competitively while fielding questions and offers from prospective buyers.

Tayenaka notes the outsize number of homes falling out of escrow recently as a cautionary tale to sellers who continue to demand 2021 prices. “Everyone thinks their house is special,” she says.

Even though the market may still be tipped in your favor, it’s in your best interest to present your home in the best possible light. Not everyone has cash dedicated to renovations and repairs, but a little sweat equity can go a long way. The first step is to declutter, organize and clean.

Tuck away stacks of bills and receipts, store toys and make sure your kitchen is tidy. Bright lighting is also a great way to make your home feel spacious and light.

Even if your home is outdated, a clean space gives buyers a chance to envision the potential of the new home.

So, as a homeowner...

What should you do NOW, if you are thinking about Selling your Home in the next few months?

Simple!

Contact Maida Quintero. Click HERE to do just that.

Contact Me!

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Realtor@RealtorMaida.com
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